Does a Checkers franchisee with development rights have the option to renew or extend their agreement?
Checkers Franchise · 2025 FDDAnswer from 2025 FDD Document
2.01 Term and Development Fee. Unless sooner terminated in accordance with Section 8, the term of this Agreement (the "Term") starts on the Effective Date and expires on the expiration date set forth in Exhibit A. You have no right to renew or extend your rights under this Agreement. At the time you sign this Agreement, you must pay us a development fee in the amount set forth in Exhibit A. The development fee is non-refundable and shall be deemed earned when paid.
Source: Item 23 — RECEIPTS (FDD pages 92–384)
What This Means (2025 FDD)
According to the 2025 Checkers Franchise Disclosure Document, a franchisee with development rights does not have the option to renew or extend their agreement. The term of the Development Agreement starts on the effective date and expires on the date set forth in Exhibit A. Checkers explicitly states that the franchisee has no right to renew or extend their rights under the Development Agreement.
This means that at the end of the agreement term, the franchisee's rights to develop restaurants in the designated area cease, unless a new agreement is negotiated and signed. This is a critical point for prospective franchisees to consider, as it impacts their long-term business strategy and investment horizon. Unlike a standard franchise agreement that may offer renewal options, the Development Agreement has a fixed term with no guarantee of extension.
Given this lack of renewal option, it is important for potential Checkers franchisees to carefully evaluate the terms of the Development Agreement, including the development schedule and obligations. Understanding the timeline for opening restaurants and the potential for meeting those obligations within the agreement's term is crucial. Additionally, franchisees should discuss with Checkers the possibility of future development opportunities or new agreements upon the expiration of the initial Development Agreement to ensure long-term growth prospects.