What information must a proposed transferee of Checkers Development Rights provide to Checkers?
Checkers Franchise · 2025 FDDAnswer from 2025 FDD Document
(c) the proposed transferee and its owners (if the proposed transferee is a corporation, partnership, limited liability company or other legal entity) must provide us on a timely basis all information we request, and must be individuals acting in their individual capacities who are of good character and reputation, who must have sufficient business and development experience, aptitude and financial resources to develop Restaurants pursuant to this Agreement, and who must otherwise meet our approval;
(d) the proposed transferee may not be an entity, or be affiliated with an entity, that is required to comply with the reporting and information requirements of the Securities Exchange Act of 1934, as amended;
Source: Item 23 — RECEIPTS (FDD pages 92–384)
What This Means (2025 FDD)
According to Checkers' 2025 Franchise Disclosure Document, if a franchisee seeks to transfer their development rights, the proposed transferee must provide Checkers with all requested information on a timely basis. This information is used by Checkers to assess whether the transferee possesses the necessary character, reputation, business and development experience, aptitude, and financial resources to successfully develop Checkers restaurants under the existing agreement. The individuals must act in their individual capacities.
This requirement ensures that any new entity taking over development rights meets Checkers' standards for franchisees. Checkers aims to maintain consistent quality and operational capabilities across its franchise network. By requiring detailed information, Checkers can thoroughly evaluate the transferee's suitability and mitigate potential risks associated with the transfer.
It is important to note that the proposed transferee cannot be an entity affiliated with one required to comply with the reporting and information requirements of the Securities Exchange Act of 1934. This condition may limit the pool of eligible transferees and should be considered by franchisees planning to transfer their development rights. Franchisees should communicate clearly with Checkers and the potential transferee to ensure all necessary information is provided promptly and accurately to facilitate a smooth transfer process.