What is the impact of the Illinois Rider on Section 18.07 of the Checkers Development Agreement?
Checkers Franchise · 2025 FDDAnswer from 2025 FDD Document
- Arbitration; Jurisdiction and Venue. Sections 10.06 and 10.07 of the Agreement shall be amended by adding the following:
Despite the provision above, Franchisor and Area Franchisee agree that any action brought by one of them against the other must be instituted in a state or federal court located in the State of Illinois.
- Governing Law. Section 10.07 of the Agreement shall be amended further by adding the following:
Despite the provision above, Franchisor and Franchisee agree that Illinois law will govern this Agreement.
Source: Item 22 — CONTRACTS (FDD pages 91–92)
What This Means (2025 FDD)
According to Checkers' 2025 Franchise Disclosure Document, the Illinois Rider modifies Section 18.07 of the Development Agreement, which typically deals with jurisdiction and venue for legal actions. The rider stipulates that any legal action between Checkers and the Area Franchisee must be initiated in a state or federal court located in Illinois, regardless of what the original agreement states. This modification is included in the Illinois Rider to the Development Agreement in recognition of the Illinois Franchise Disclosure Act requirements.
This means that if a Checkers Area Franchisee in Illinois has a dispute with the franchisor that leads to a lawsuit, the suit must be filed in Illinois, which could be more convenient and cost-effective for the franchisee, especially if the franchisee is based in Illinois. It ensures that Illinois-based franchisees are not forced to litigate in a distant or inconvenient jurisdiction, which is a protective measure under Illinois franchise law.
Furthermore, the Illinois Rider also specifies that Illinois law will govern the Development Agreement, regardless of any conflicting provisions in the original agreement. This ensures that the agreement is interpreted and enforced under Illinois law, providing additional legal certainty and protection for the franchisee. This is a common practice in franchise agreements to ensure compliance with state-specific franchise laws.