Does Checkers offer new or additional 'Western License Agreements' as part of this Franchise Disclosure Document?
Checkers Franchise · 2025 FDDAnswer from 2025 FDD Document
In 1997, in response to certain issues raised by several Rally's franchisees in California and Arizona, and in a mutual effort to avoid a protracted dispute, we agreed to a material modification of the franchise agreements with the affected California and Arizona Rally's franchisees. The Rally's franchisees are referred to as the "Western Licensees," and they have agreed to execute license agreements to replace their franchise agreements. Under the "Western License Agreement," the Western Licensees will pay a reduced royalty (1% of Net Sales), and we have agreed that the services that we are obligated to provide to them will be materially different from, and will be substantially less than, the services that we provide to franchisees under the Franchise Agreement. Under the Western License Agreement, those Rally's franchisees who elect to obtain advertising material from our advertising agency will pay a license fee of 2% of Net Sales. We do not offer new or additional Western License Agreements as part of this Franchise Disclosure Document.
Source: Item 1 — THE FRANCHISOR AND ANY PARENTS, PREDECESSORS AND AFFILIATES (FDD pages 9–14)
What This Means (2025 FDD)
According to Checkers's 2025 Franchise Disclosure Document, Checkers does not offer new or additional Western License Agreements. The document explains that in 1997, Checkers modified franchise agreements with Rally's franchisees in California and Arizona to avoid disputes. These franchisees, known as "Western Licensees," agreed to license agreements replacing their franchise agreements.
Under the Western License Agreement, these franchisees pay a reduced royalty of 1% of Net Sales. In return, the services Checkers provides to them are materially different and substantially less than those provided to regular franchisees. If these Rally's franchisees choose to obtain advertising material from Checkers' advertising agency, they pay a license fee of 2% of Net Sales.
For a prospective franchisee, this means that the Western License Agreement is not a currently available option. This agreement was a one-time modification made to resolve specific issues with franchisees in the late 1990s and is not something a new franchisee can pursue in 2025.