When will Checkers defer collection of initial fees owed under the Development Agreement?
Checkers Franchise · 2025 FDDAnswer from 2025 FDD Document
Despite the payment provisions in Item 5 of the Disclosure Document, we will defer your payment of initial fees owed by you to us under the Franchise Agreement until all of our pre-opening obligations have been satisfied and you commence doing business under the Franchise Agreement.
We also will defer collection of all initial fees owed under the Development Agreement until we have completed all of our pre-opening obligations under the applicable franchise agreement entered into pursuant to the Development Agreement and you commence doing business under that franchise agreement.
Source: Item 23 — RECEIPTS (FDD pages 92–384)
What This Means (2025 FDD)
According to Checkers' 2025 Franchise Disclosure Document, Checkers will defer collection of all initial fees owed under the Development Agreement until they have completed all of their pre-opening obligations under the applicable franchise agreement entered into pursuant to the Development Agreement. This deferral extends until the franchisee commences business operations under that franchise agreement.
This policy means a prospective Checkers developer doesn't have to pay the initial fees until Checkers has fulfilled its obligations to get the restaurant ready to open. This lessens the initial financial burden on the franchisee, as they don't have to pay until the restaurant is closer to generating revenue.
It is important to note that this deferral is tied to the completion of Checkers' pre-opening obligations and the commencement of business by the franchisee. If there are delays in either of these areas, it could affect the timing of when the initial fees become due. Additionally, specific states like Illinois and Virginia may have addendums that further modify these terms.