According to the document, what is the purpose of the Franchise Agreement addendum for Checkersrallys?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
WHEREAS, the Parties now desire to modify the Franchise Agreement according to the terms and conditions set forth in this Addendum.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:
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- Relationship to Franchise Agreement; Recitals. This Addendum shall be annexed to and form a part of the Franchise Agreement. All capitalized terms not otherwise defined in this Addendum shall have the meanings set forth in the Franchise Agreement. Except as modified by this Addendum, the Franchise Agreement remains in full force and effect. Any conflict between the provisions hereof and the Franchise Agreement shall be construed in favor of this Addendum. All references in this Addendum to "Sections," "Subsections," and/or "Exhibits" shall mean the applicable Section(s), Subsection(s), and/or Exhibit(s) of the Franchise Agreement, unless specified otherwise below. The Recitals above are incorporated into this Addendum by reference.
Source: Item 22 — CONTRACTS (FDD pages 91–92)
What This Means (2025 FDD)
According to Checkersrallys's 2025 Franchise Disclosure Document, the Franchise Agreement addendum serves to modify the existing Franchise Agreement under specific terms and conditions. The addendum is designed to allow franchisees to qualify for and receive certain incentives related to operating a franchised restaurant. These incentives often involve a reduction in the initial franchise fee. The addendum outlines the qualifications a franchisee must meet to receive these benefits, such as being a current franchisee in good standing and adhering to Checkersrallys's development plans and design standards.
The addendum also specifies conditions under which the franchisee may lose the benefits of the incentive. For instance, if a franchisee requests a transfer before opening the restaurant, they may be required to pay back the reduced portion of the initial franchise fee. Similarly, if the franchisee breaches the agreement or fails to meet the specified criteria, they may be required to repay the amount of the fee reduction or discount they received. This ensures that Checkersrallys can recover the incentive if the franchisee does not fulfill their obligations.
Furthermore, the addendum includes standard legal provisions, such as stating that it constitutes the entire agreement regarding its subject matter, supersedes prior agreements, and can only be modified in writing. It also allows for the agreement to be executed in counterparts and signed electronically, providing flexibility in the signing process. For franchisees, it is crucial to understand all the terms and conditions outlined in the addendum, as it directly impacts their financial obligations and operational requirements under the Franchise Agreement. The addendum ensures both Checkersrallys and the franchisee are aligned on the specific modifications and incentives being offered.