What is the deadline for obtaining all necessary permits, licenses, or other regulatory or municipal approvals to open a Checkersrallys Franchised Restaurant to be eligible for a partial refund of the initial franchise fee?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
The initial franchise fee (and asset transfer fee, if applicable) is fully earned by us as of the Effective Date and is non-refundable, except that we may provide you a refund of fifty percent (50%) of the initial franchise fee paid to us if: (a) you (i) are unable to obtain a site acceptable to us within the Designated Area for the Franchised Restaurant within the time period prescribed in Section 3.02, or (ii) despite having expended good faith best efforts (as we determine in our sole judgment), have not obtained all necessary permits, licenses, or other regulatory or municipal approvals to be able to open the Franchised Restaurant in accordance with applicable law within sixty (60) days after your execution of the proposed lease, sublease or purchase agreement for the Premises; and (b) you and your Owners execute general releases, in form and substance satisfactory to us, of any and all
claims against us, and our Affiliates, officers, directors, employees, agents, successors and assigns.
Source: Item 22 — CONTRACTS (FDD pages 91–92)
What This Means (2025 FDD)
According to Checkersrallys's 2025 Franchise Disclosure Document, a franchisee may be eligible for a refund of 50% of the initial franchise fee if they meet certain conditions. One of these conditions is that the franchisee must obtain all necessary permits, licenses, or other regulatory or municipal approvals to open the Franchised Restaurant within 60 days after executing the proposed lease, sublease, or purchase agreement for the premises. This is contingent on the franchisee demonstrating good faith and best efforts in trying to obtain the approvals.
To receive the refund, the franchisee must also be unable to secure a site acceptable to Checkersrallys within the designated area within the time frame specified in Section 3.02 of the franchise agreement. Additionally, both the franchisee and their owners must execute general releases, in a form and substance satisfactory to Checkersrallys, releasing any and all claims against Checkersrallys and its affiliates, officers, directors, employees, agents, successors, and assigns.
This provision offers a limited safety net for franchisees who encounter significant delays or obstacles in securing necessary approvals or finding a suitable site. However, it's important to note that the refund is partial, and the franchisee must still demonstrate that they acted in good faith. The specific requirements for demonstrating "good faith best efforts" are determined solely by Checkersrallys, which introduces an element of subjectivity. Prospective franchisees should carefully consider these conditions and assess the potential risks associated with site selection and permitting processes before entering into a franchise agreement with Checkersrallys.