What is the purpose of the addendum mentioned in the agreement between Checkersrallys and the franchisee?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
or for the operation of at least two (2) "Checkers" or "Rally's" restaurants;
| | WHEREAS, Franchisor | | | | and Franchisee are Parties to that certain Franchise Agreement | | | |---------|---------------------|-------------------------------------------------------------------------------------------|----|-----------|----------------------------------------------------------------|---------|----| | | | dated of even date herewith (the "Franchise Agreement") pursuant to which Franchisee will | | | | | | | operate | another | "Checkers" (the "Franchised Restaurant"); | or | "Rally's" | restaurant | located | at | WHEREAS, Franchisee desires to qualify for and receive, the benefits of the Incentive; and
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.
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- Qualifications. You represent, and in connection with signing this Addendum have provided us (or agree to provide promptly upon our request) relevant supporting documentation, that: (a) you are a current franchisee in good standing
with us, including being in full compliance with all currently effective agreements with us or our affiliates; and (b) you will remain a franchis
Source: Item 22 — CONTRACTS (FDD pages 91–92)
What This Means (2025 FDD)
According to Checkersrallys's 2025 Franchise Disclosure Document, the purpose of the addendum is to modify the existing franchise agreement based on specific terms and conditions outlined within the addendum itself. The addendum is attached to and becomes a part of the original franchise agreement, with all capitalized terms retaining their original definitions unless otherwise specified in the addendum. The addendum clarifies that the franchise agreement remains in effect except for the modifications explicitly stated in the addendum. In case of conflicts between the addendum and the franchise agreement, the provisions of the addendum take precedence.
Specifically, the addendum addresses situations where a franchisee is seeking to qualify for and receive incentives. For instance, it outlines the qualifications a franchisee must meet, such as being a franchisee in good standing and complying with all existing agreements with Checkersrallys. The addendum also stipulates that the franchisee must open the franchised restaurant within one year of signing the franchise agreement. In return for meeting these qualifications, the addendum may revise certain fees, such as reducing the initial franchise fee by $10,000 from the standard amount.
The addendum also includes conditions under which the franchisee may lose the benefits of the incentive. For example, if the franchisee requests a transfer before opening the restaurant, they must pay Checkersrallys the amount of the initial fee reduction prior to the transfer. Similarly, if the franchisee breaches any of the criteria listed in the addendum, including the obligation to open the restaurant within one year, they must pay Checkersrallys the amount of the initial fee reduction. The addendum also serves as the entire agreement regarding its specific subject matter, superseding any prior agreements, and can only be altered in writing by both parties.