If a proposed transferee of a Checkers franchise is unwilling to agree in writing to comply with all lawful obligations, is that considered good cause for refusal?
Checkers Franchise · 2025 FDDAnswer from 2025 FDD Document
- (g) A provision which permits a franchisor to refuse to permit a transfer of ownership of a franchise, except for good cause. This subdivision does not prevent a franchisor from exercising a right of first refusal to purchase the franchise. Good cause shall include, but is not limited to:
- (iii) The unwillingness of the proposed transferee to agree in writing to comply with all lawful obligations.
Source: Item 23 — RECEIPTS (FDD pages 92–384)
What This Means (2025 FDD)
According to Checkers' 2025 Franchise Disclosure Document, a franchisor can refuse a transfer of ownership of a franchise for good cause. Good cause includes if the proposed transferee is unwilling to agree in writing to comply with all lawful obligations.
This means that if you, as a Checkers franchisee, want to sell or transfer your franchise to someone else, that person must agree to follow all the legal requirements of the franchise agreement. If the potential buyer isn't willing to put that agreement in writing, Checkers has grounds to deny the transfer.
This provision protects Checkers by ensuring that anyone taking over a franchise is committed to upholding the brand's standards and legal obligations. It also aligns with standard franchising practices, where franchisors typically retain the right to approve franchise transfers to maintain consistency and protect their brand reputation.