What is the requirement for a Checkers franchisee regarding amendments to organizational documents?
Checkers Franchise · 2025 FDDAnswer from 2025 FDD Document
8. YOUR ORGANIZATION AND MANAGEMENT.
Organizational Documents. If you are, or at any time become, a business corporation, partnership, limited liability company or other legal entity, you and each of your Owners represent, warrant and agree that: (a) you are duly organized and validly existing under the laws of the state of your organization, and, if a foreign business corporation, partnership, limited liability company or other legal entity, you are duly qualified to transact business in the state in which the Franchised Restaurant is located; (b) your undersigned signatory below has the authority to execute and deliver this Agreement on your behalf and that you are able and authorized to perform your obligations hereunder; (c) true and complete copies of the articles of incorporation, partnership agreement, bylaws, subscription agreements, buy-sell agreements, voting trust agreements and all other documents relating to your ownership, organization, capitalization, management and control have been delivered to us and all amendments thereto shall be promptly delivered to us; (d) your activities are restricted to those necessary solely for the development, ownership and operation of Restaurants in accordance with this Agreement and in accordance with any other agreements entered into with us or any of our Affiliates; (e) the articles of incorporation, partnership agreement or other organizational documents recite that the issuance, transfer or pledge of any direct or indirect legal or beneficial ownership interest is restricted by the terms of this Agreement; and (f) all
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certificates representing direct or indirect legal or beneficial ownership interests now or hereafter issued must bear a legend in conformity with applicable law reciting or referring to such restrictions.
Source: Item 22 — CONTRACTS (FDD pages 91–92)
What This Means (2025 FDD)
According to Checkers' 2025 Franchise Disclosure Document, if a franchisee is a business corporation, partnership, limited liability company, or other legal entity, they must provide Checkers with true and complete copies of all documents relating to the ownership, organization, capitalization, management, and control of the business. This includes articles of incorporation, partnership agreements, bylaws, subscription agreements, buy-sell agreements, and voting trust agreements.
Furthermore, Checkers requires that franchisees promptly deliver to them all amendments to these organizational documents. This ensures that Checkers is always aware of the current structure and ownership of the franchisee's business.
Additionally, the organizational documents must state that the issuance, transfer, or pledge of any direct or indirect legal or beneficial ownership interest is restricted by the terms of the Franchise Agreement. All certificates representing ownership interests must bear a legend that conforms with applicable law, reciting or referring to such restrictions. This provision allows Checkers to maintain control over who can become an owner of a Checkers franchise and ensures that potential new owners are aware of the obligations under the Franchise Agreement.