What is the effect of the Checkers Existing Franchisee Incentive Addendum on the Initial Franchise Fee?
Checkers Franchise · 2025 FDDAnswer from 2025 FDD Document
WHEREAS, Franchisor has implemented an incentive program available to qualified existing franchisees of "Checkers" or "Rally's" restaurants under which the Initial Franchise Fee due under Franchisor's current form of franchise agreement is reduced by $10,000 if the franchisee opens its Restaurant within one (1) year of signing the Franchise Agreement (the "Existing Franchisee Incentive" or "Incentive");
WHEREAS, Franchisee is an existing franchisee under separate franchise agreements with Franchisor for the operation of at least two (2) "Checkers" or "Rally's" restaurants;
- Reduced Fee(s). In consideration of your qualification for the Incentive identified in the Recitals above, Section 6.01 is revised to reflect that the Initial Franchise Fee due is reduced by ten thousand dollars ($10,000) (the "Initial Fee Reduction") from the standard amount of the current initial franchise fee otherwise due for a new Restaurant.
Source: Item 22 — CONTRACTS (FDD pages 91–92)
What This Means (2025 FDD)
According to Checkers' 2025 Franchise Disclosure Document, the Existing Franchisee Incentive Addendum can reduce the initial franchise fee. Specifically, Checkers offers an incentive program to qualified existing franchisees of Checkers or Rally's restaurants. Under this program, the initial franchise fee is reduced by $10,000 if the franchisee opens their restaurant within one year of signing the Franchise Agreement.
To qualify for this incentive, the franchisee must be an existing franchisee operating at least two Checkers or Rally's restaurants under separate franchise agreements with Checkers. The franchisee must also be in good standing with Checkers, fully complying with all current agreements, and commit to opening the new franchised restaurant within one year of signing the franchise agreement.
This incentive is formalized through an addendum to the Franchise Agreement, which modifies Section 6.01 to reflect the reduced initial franchise fee. However, if the franchisee requests a transfer before opening the restaurant or breaches the qualification criteria, they may be required to pay back the reduced amount. This addendum, like others, contains standard clauses regarding the relationship to the Franchise Agreement, the entire agreement, counterparts, and electronic signatures.