For Checkers, what is the maximum total value of the royalty fee abatement?
Checkers Franchise · 2025 FDDAnswer from 2025 FDD Document
staurant in accordance with our current prescribed plans, specifications and design model for Restaurants (including,
without limitation, any modifications or adjustments we authorize and timely introduce for similarly-situated Restaurants, or otherwise incorporate into the System for all franchisees, before you open the Franchised Restaurant).
3. Conditional Development Incentive and Reduced Fee(s).
- a. Royalty Fee Abatement: If you meet the following criteria: (i) you open the Franchised Restaurant to the general public within 18 months of signing the Franchise Agreement; (ii) the Franchised Restaurant complies with the current reimaging requirements and (iii) you, your owners, or your and their affiliates are Restaurant Net Positive (defined below) at the time the Franchised Restaurant opens, then we will waive the royalty fee payable under the Franchise Agreement until the earlier of: (a) the total value of the royalty fee abatement (calculated based on the standard royalty fee due under the Franchise Agreement) equals Se
Source: Item 22 — CONTRACTS (FDD pages 91–92)
What This Means (2025 FDD)
According to Checkers' 2025 Franchise Disclosure Document, a royalty fee abatement is available under certain conditions. If a new Checkers franchisee opens their restaurant within 18 months of signing the Franchise Agreement, complies with reimaging requirements, and is "Restaurant Net Positive" at the time of opening, Checkers will waive the royalty fee.
The royalty fee abatement continues until the earlier of two conditions: either the total value of the waived royalty fees reaches $75,000, or the restaurant has been operating for 24 months. The calculation of the abatement is based on the standard royalty fee due under the Franchise Agreement.
For a prospective Checkers franchisee, this incentive offers a significant potential savings during the initial period of operation. However, it's crucial to meet all specified criteria, including the Restaurant Net Positive condition, which relates to the franchisee's overall restaurant count compared to a baseline date. Failing to meet these conditions would negate the abatement, and the franchisee would be responsible for the standard royalty fees. The franchisee should clarify the definition of "Restaurant Net Positive" with Checkers, including how the number of restaurants operated is calculated.