What is the purpose of including the 'WHEREAS' clauses in the Checkers Existing Franchisee Incentive Addendum?
Checkers Franchise · 2025 FDDAnswer from 2025 FDD Document
WHEREAS, Franchisor has implemented an incentive program available to qualified existing franchisees of "Checkers" or "Rally's" restaurants under which the Initial Franchise Fee due under Franchisor's current form of franchise agreement is reduced by $10,000 if the franchisee opens its Restaurant within one (1) year of signing the Franchise Agreement (the "Existing Franchisee Incentive" or "Incentive");
WHEREAS, Franchisee is an existing franchisee under separate franchise agreements with Franchisor for the operation of at least two (2) "Checkers" or "Rally's" restaurants;
WHEREAS, Franchisee desires to qualify for and receive, the benefits of the Incentive; and
WHEREAS, the Parties now desire to modify the Franchise Agreement according to the terms and conditions set forth in this Addendum.
Source: Item 22 — CONTRACTS (FDD pages 91–92)
What This Means (2025 FDD)
According to Checkers' 2025 Franchise Disclosure Document, the 'WHEREAS' clauses in the Existing Franchisee Incentive Addendum serve to provide context and justification for the agreement between Checkers and the franchisee. These clauses, also known as recitals, outline the reasons why the addendum is being created and the mutual intentions of both parties.
Specifically, the 'WHEREAS' clauses in the Checkers addendum state that Checkers has implemented an incentive program for qualified existing franchisees of Checkers or Rally's restaurants. This program reduces the initial franchise fee by $10,000 if the franchisee opens their restaurant within one year of signing the Franchise Agreement. The clauses also state that the franchisee is an existing franchisee operating at least two Checkers or Rally's restaurants and desires to qualify for and receive the benefits of this incentive. Finally, the recitals express that both parties want to modify the existing Franchise Agreement to incorporate the terms and conditions of the addendum.
In essence, these 'WHEREAS' clauses establish the foundation for the agreement by explaining the incentive program, confirming the franchisee's eligibility, and stating the intent to modify the original franchise agreement. By including these recitals, Checkers ensures that the addendum is clear, understandable, and reflects the mutual understanding of both parties regarding the incentive being offered and accepted.