How is the term 'Affiliate' defined in the Checkers Development Agreement?

According to Checkers' 2025 Franchise Disclosure Document, an 'Affiliate' is defined as any entity or person that either directly or indirectly owns or controls the referenced party, is directly or indirectly owned or controlled by the referenced party, or is under common control with the referenced party. The term 'control' is further defined as possessing the power to direct the management and policies of an entity, whether through ownership of voting securities, by contract, or other means.

For a prospective Checkers franchisee, this definition is important because it clarifies the scope of various obligations and restrictions within the franchise agreement. For example, certain restrictions or obligations may extend not only to the franchisee but also to their affiliates. This could impact the franchisee's ability to engage in other business ventures or investments that might be seen as conflicting with the Checkers franchise.

The definition of 'control' is also significant. It means that even if a franchisee doesn't directly own a company, they could still be considered an affiliate if they have the power to influence its management and policies. This broad definition aims to prevent franchisees from circumventing the terms of the franchise agreement through related entities.

It is important for potential Checkers franchisees to fully understand this definition and how it applies to their specific circumstances. They should carefully review the franchise agreement and seek legal counsel to ensure they are aware of all the implications of the affiliate definition.