According to the Checkersrallys Development Agreement, what does the term 'Affiliate' mean?

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

For a prospective Checkersrallys franchisee, this definition is important because it clarifies the scope of relationships that could impact their franchise agreement. For instance, if a franchisee is owned or controlled by another company, that parent company would be considered an affiliate. Similarly, any entity that Checkersrallys controls would also be considered an affiliate.

This definition has implications for compliance with the development agreement, as the franchisee's compliance extends to their affiliates. A breach by an affiliate could be considered a breach by the franchisee, potentially leading to default. The definition also affects the rights Checkersrallys retains, as these rights extend to their affiliates. Understanding this definition is crucial for franchisees to assess their obligations and the potential impact of related entities on their franchise operations.