What information must a proposed transferee provide to Checkersrallys for approval of a Development Rights transfer?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
the proposed transferee and its owners (if the proposed transferee is a corporation, partnership, limited liability company or other legal entity) must provide us on a timely basis all information we request, and must be individuals acting in their individual capacities who are of good character and reputation, who must have sufficient business and development experience, aptitude and financial resources to develop Restaurants pursuant to this Agreement, and who must otherwise meet our approval;
the proposed transferee may not be an entity, or be affiliated with an entity, that is required to comply with the reporting and information requirements of the Securities Exchange Act of 1934, as amended;
the transferee and its owners must agree to be bound by all of the provisions of this Agreement for the remainder of its term;
Source: Item 23 — RECEIPTS (FDD pages 92–384)
What This Means (2025 FDD)
According to Checkersrallys's 2025 Franchise Disclosure Document, a proposed transferee and its owners must provide Checkersrallys with all information the company requests on a timely basis. The individuals must be of good character and reputation, possess sufficient business and development experience, aptitude, and financial resources to develop Checkersrallys Restaurants, and otherwise meet Checkersrallys's approval. If the proposed transferee is a corporation, partnership, limited liability company or other legal entity, its owners must also meet these requirements.
This means that Checkersrallys has broad discretion to request various types of information from potential transferees to assess their suitability. This could include financial statements, business plans, resumes, background checks, and other documentation. The prospective franchisee should be prepared to provide comprehensive information and demonstrate their qualifications to meet Checkersrallys's standards.
It is important to note that the proposed transferee cannot be an entity, or affiliated with an entity, that is required to comply with the reporting and information requirements of the Securities Exchange Act of 1934, as amended. This condition may limit the pool of eligible transferees to those that are not publicly traded or subject to extensive securities regulations. Furthermore, the transferee and its owners must agree to be bound by all the provisions of the Development Rights Agreement for the remainder of its term, ensuring continuity and adherence to the established terms and conditions.
Overall, the information requirements for a proposed transferee reflect Checkersrallys's interest in ensuring that any new developer has the necessary capabilities, resources, and commitment to successfully develop and operate Checkersrallys Restaurants. A prospective franchisee should carefully review these requirements and prepare to provide all necessary information to facilitate the transfer approval process.