How is the successor franchise fee determined for a Checkers franchise with a 10-year term?
Checkers Franchise · 2025 FDDAnswer from 2025 FDD Document
successor franchise term is for twenty (20) years; or (ii) one-third (1/3), or thirty-three and one-third percent (33.33%), of the amount of our then current initial franchise fee due for new Restaurants, if your successor franchise term is for ten (10) years. In addition, you and your Owners must execute general releases, in form and substance satisfactory to us or as we then explicitly prescribe, of any and all claims against us, and our Affiliates, owners, officers, directors, employees, agents, successors and assigns. Failure by you (and your Owners) to sign such agreements and releases within thirty (30) days after delivery to you shall be deemed an election by you not to acquire a successor franchise for the Franchised Restaurant. Upon expiration of such successor franchise agreement, you will have a further right on terms and conditions contained in the successor franchise agreement to acquire a future successor franchise as we then prescribe.
Source: Item 22 — CONTRACTS (FDD pages 91–92)
What This Means (2025 FDD)
According to Checkers's 2025 Franchise Disclosure Document, the successor franchise fee is determined by the term length of the new agreement. If a franchisee is eligible to renew their franchise agreement with Checkers, the term can be either ten or twenty years, as agreed upon by both parties. The fee due upon signing the successor franchise agreement depends on this term length.
For a successor franchise term of ten years, the successor franchise fee is one-third (33.33%) of the then-current initial franchise fee for new Checkers restaurants. For example, if the initial franchise fee for a new restaurant is $45,000 at the time of renewal, the successor franchise fee for a 10-year term would be $15,000.
In addition to the successor franchise fee, the franchisee and their owners must execute general releases of any and all claims against Checkers and its affiliates. These releases must be in a form and substance satisfactory to Checkers. Failure to sign the agreements and releases within thirty days after delivery is deemed an election by the franchisee not to acquire a successor franchise. Upon expiration of the successor franchise agreement, the franchisee may have a further right to acquire a future successor franchise on terms and conditions contained in the successor franchise agreement as Checkers then prescribes.