Does Checkers expect pending litigation to have a material impact on its business or consolidated financial position?
Checkers Franchise · 2025 FDDAnswer from 2025 FDD Document
From time to time, we are involved in legal proceedings arising in the ordinary course of business relating to matters including, but not limited to, disputes with franchisees, suppliers, employees (including pursuant to employment discrimination and wage and hour laws) and customers, as well as disputes over intellectual property. We do not expect the outcome of pending litigation to have a material impact on our business or consolidated financial position, although it may have a material impact on our consolidated results of operations in any particular annual period.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 91)
What This Means (2025 FDD)
According to Checkers' 2025 Franchise Disclosure Document, Checkers acknowledges involvement in legal proceedings that arise in the ordinary course of business. These proceedings include disputes with franchisees, suppliers, employees (including those related to employment discrimination and wage and hour laws), and customers, as well as disputes over intellectual property.
However, Checkers states that it does not anticipate the outcome of any pending litigation to have a material impact on its overall business or consolidated financial position. This suggests that while legal issues are a normal part of operations, Checkers believes that these issues will not significantly affect the company's financial stability or long-term prospects.
It is important to note that while Checkers does not expect a material impact on its business or consolidated financial position, the FDD states that pending litigation may have a material impact on the consolidated results of operations in any particular annual period. This means that while the overall financial health of the company may not be threatened, specific legal issues could potentially affect Checkers' profitability in a given year. Prospective franchisees should consider this when evaluating the potential risks and rewards of investing in a Checkers franchise.