What factors determine the number of Checkersrallys restaurants required to be developed under a Development Agreement?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
ised Restaurant's area.
Development Agreement
If we agree to grant you development rights, you and we will enter into a Development Agreement, which requires you to pay a development fee of $10,000 per restaurant to be developed. The number of restaurants to be developed pursuant to a Development Agreement varies depending upon a variety of factors, including (1) existing population and anticipated population growth within the Development Area; (2) competition within the Development Area; and (3) the number of Checkers Restaurants or Rally's Restaurants we estimate can be developed within the Development Area.
Under the Development Agreement, you are required to pay the then-current standard initial franchise fee for each Restaurant you are required to develop under a Development Agreement; however, $10,000 of the development fee is credited to the initial franchise fee payable for each Restaurant you are required to open under the Development Agreement until the development fee is credited in full. The development fee is not refundable, in whole or in part, except if we terminate the Development Agreement as a result of adverse franchise legislation. In this event, we will r
Source: Item 5 — INITIAL FEES (FDD pages 17–21)
What This Means (2025 FDD)
According to Checkersrallys's 2025 Franchise Disclosure Document, the number of restaurants a developer is required to build under a Development Agreement is based on several factors. These include the existing population and anticipated population growth within the designated Development Area. Checkersrallys also considers the level of competition present in that area. Finally, the company assesses the estimated number of Checkers Restaurants or Rally's Restaurants that the Development Area can support.
If Checkersrallys agrees to grant development rights, the franchisee must enter into a Development Agreement and pay a development fee of $10,000 per restaurant to be developed. This fee is generally non-refundable, but there is an exception if Checkersrallys terminates the agreement due to adverse franchise legislation, in which case the uncredited portion of the fee will be refunded.
The franchisee is also required to pay the then-current standard initial franchise fee for each restaurant they are obligated to develop under the Development Agreement. However, $10,000 of the development fee is credited towards the initial franchise fee for each restaurant opened under the agreement until the development fee is fully credited. This provides a financial incentive for developers to proceed with the development schedule outlined in their agreement with Checkersrallys.