Does the Checkers franchise agreement specify that if Checkers files a claim in a judicial or arbitration proceeding for amounts you or any of your Owners owe us or any of our Affiliates, or if we enforce this Agreement in a judicial or arbitration proceeding, and we prevail in any such proceeding, you agree to reimburse us for all of our costs and expenses, including reasonable accounting, paralegal, expert witness and attorneys' fees?

According to Checkers' 2025 Franchise Disclosure Document, the franchise agreement does address the reimbursement of costs and expenses in the event of legal proceedings. Specifically, if Checkers files a claim against a franchisee or their owners for amounts owed to Checkers or its affiliates, or if Checkers enforces the franchise agreement through judicial or arbitration proceedings, and Checkers prevails, the franchisee is required to reimburse Checkers for all costs and expenses. These costs include reasonable accounting, paralegal, expert witness, and attorneys' fees. This provision is designed to protect Checkers from incurring financial losses due to legal actions necessary to recover debts or enforce the franchise agreement.

This clause means that a Checkers franchisee could face significant financial burdens beyond the initial investment and ongoing operational costs if a dispute arises that leads to legal action where Checkers is the prevailing party. It is important to note that the franchisee's obligation to cover these costs is contingent on Checkers winning the legal proceeding. This creates a financial risk for franchisees, as they could be responsible for not only their own legal expenses but also Checkers' expenses if they lose the case.

Such a provision is relatively common in franchise agreements, as franchisors often seek to protect their interests and ensure that franchisees comply with the terms of the agreement. However, prospective franchisees should carefully consider the potential financial implications of this clause and factor it into their assessment of the overall risks and benefits of investing in a Checkers franchise. It would be prudent for a potential franchisee to seek legal counsel to fully understand the scope of this obligation and to negotiate terms that may provide some level of protection or limitation on these costs.