What is the effect of the Existing Franchisee Incentive Addendum on the Checkers Franchise Agreement if the franchisee is not in compliance with other agreements?

According to Checkers's 2025 Franchise Disclosure Document, the Existing Franchisee Incentive Addendum includes specific conditions regarding compliance with existing agreements. To qualify for the incentive, a franchisee must be in full compliance with all currently effective agreements with Checkers or its affiliates. This requirement is not only a prerequisite for signing the addendum but also an ongoing obligation throughout the term of the Franchise Agreement.

If a Checkers franchisee breaches, fails to satisfy, or is later found to have violated any of these criteria at any point during the term, Checkers has specific remedies. In addition to any other remedies available under the Franchise Agreement or applicable law, Checkers can require the franchisee to pay back the amount or value of any fee reduction, discount, or other benefit afforded under the addendum. This payment must be made no later than thirty days after written notice from Checkers.

In practical terms, this means that if a Checkers franchisee receives a $10,000 reduction in the initial franchise fee due to the Existing Franchisee Incentive and subsequently violates any agreement with Checkers, they will be required to repay the $10,000. This condition underscores the importance of maintaining compliance with all agreements to retain the benefits of the incentive. The Existing Franchisee Incentive Addendum serves as a modification to the original Franchise Agreement, and any conflict between the two will be resolved in favor of the Addendum.