What releases are required to be executed by the franchisee and their Owners to be eligible for a refund of the Checkersrallys 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 and their Owners must execute general releases to be eligible for a refund of a portion of the initial franchise fee. Specifically, Checkersrallys may provide a refund of fifty percent (50%) of the initial franchise fee if the franchisee is unable to secure a site acceptable to Checkersrallys within the designated area within the time prescribed in Section 3.02, or if the franchisee, despite good faith efforts, cannot obtain the necessary permits, licenses, or other regulatory or municipal approvals to open the Franchised Restaurant within sixty (60) days after executing the proposed lease, sublease, or purchase agreement for the Premises.
To receive this refund, the franchisee and their Owners must execute general releases. These releases must be in a form and substance satisfactory to Checkersrallys, covering any and all claims against Checkersrallys, its Affiliates, officers, directors, employees, agents, successors, and assigns. This requirement ensures that Checkersrallys is protected from potential legal action related to the failed restaurant opening if they provide the refund.
This condition is fairly standard in the franchise industry. Franchisors often require releases to protect themselves from future claims when refunding fees, especially when the failure to open is due to circumstances outside of the franchisor's direct control, such as site acquisition or permitting issues. Prospective Checkersrallys franchisees should carefully review the form and substance of the required releases to understand the full scope of claims they are waiving in exchange for the partial refund of the initial franchise fee.