What is the effect of the Illinois Rider on the payment provisions in the Checkers Development Agreement?

According to Checkers's 2025 Franchise Disclosure Document, the Illinois Rider to the Development Agreement modifies the payment provisions outlined in Section 2.01 of the standard agreement. Specifically, Checkers will defer collecting initial fees from the Area Franchisee until Checkers has fulfilled all pre-opening obligations for the first franchise agreement under the Development Agreement, and the Area Franchisee has started business operations under that first franchise agreement.

This deferral is a direct requirement imposed by the Illinois Attorney General's Office, and it is based on Checkers's financial condition. This means that franchisees in Illinois will not have to pay the initial fees until Checkers has completed its responsibilities in setting up the first franchise location and that location is open for business.

For a prospective Checkers franchisee in Illinois, this is a significant benefit as it reduces the upfront financial burden and risk. It ensures that the franchisee only pays the initial fees after Checkers has demonstrated its commitment by fulfilling its pre-opening obligations and the business is operational. This condition provides an added layer of security for the franchisee, aligning the payment of fees with the progress of the franchise development.