What is the requirement for a Checkers franchisee regarding the accuracy of Exhibit A as of the Effective Date?
Checkers Franchise · 2025 FDDAnswer from 2025 FDD Document
- 8.02 Disclosure of Ownership Interests. You and all of your Owners represent, warrant and agree that Exhibit A is current, complete and accurate as of the Effective Date. You agree to promptly notify us of any proposed or intended change to your ownership structure during the Term, to obtain our approval in accordance with the transfer conditions of Section 13.02 below before initiating any such change, and to sign a then-updated and accurate form of Exhibit A (which will replace its predecessor version of Exhibit A) if we approve the change. Each person who is or becomes an Owner must execute an agreement in form and substance as we then prescribe, undertaking to be bound jointly and severally by this Agreement. Each Owner must be an individual acting in his individual capacity, unless we waive this requirement.
Source: Item 22 — CONTRACTS (FDD pages 91–92)
What This Means (2025 FDD)
According to Checkers' 2025 Franchise Disclosure Document, Exhibit A to the Franchise Agreement must be current, complete, and accurate as of the Effective Date. Exhibit A typically contains information about the franchisee's ownership structure. This means that when the franchise agreement takes effect, the ownership details provided by the franchisee must be up-to-date and without omissions.
Furthermore, the franchisee must promptly inform Checkers of any planned changes to their ownership structure during the term of the agreement. Before implementing any such change, the franchisee needs to obtain Checkers' approval, adhering to the transfer conditions outlined in Section 13.02 of the agreement. If Checkers approves the change, the franchisee must then sign an updated version of Exhibit A, which will replace the previous version.
Each individual who is or becomes an owner must also sign an agreement that binds them jointly and severally to the Franchise Agreement. Unless Checkers waives this requirement, each owner must act in their individual capacity. This ensures that all owners are legally responsible for upholding the terms of the franchise agreement. For a prospective franchisee, this highlights the importance of maintaining accurate ownership records and seeking franchisor approval for any changes to avoid potential breaches of the agreement.