What are the requirements for the proposed transferee's character, reputation, business experience, aptitude, and financial resources to gain Checkersrallys' approval?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
or's Approval**.The rights and duties created by this Agreement are personal to you or, if you are a business corporation, partnership, limited liability company or other legal entity, your Owners. Accordingly, neither you nor any of your Owners may transfer the Franchise without our approval and without complying with all of the provisions of Section 13. Any transfer without such approval or compliance constitutes a breach of this Agreement and is void and of no force or effect.
- 13.02 Conditions for Approval.If we have not exercised our right of first refusal under Section 13.06, we will not unreasonably withhold our approval of a transfer of the Franchise that meets all of the reasonable restrictions, requirements and conditions we impose on the transfer, the transferor(s) and/or the transferee(s), including the following:
- (a) you have completed development of the Franchised Restaurant and are operating the Franchised Restaurant in accordance with this Agreement;
Source: Item 22 — CONTRACTS (FDD pages 91–92)
What This Means (2025 FDD)
According to Checkersrallys's 2025 Franchise Disclosure Document, if Checkersrallys has not exercised its right of first refusal, it will not unreasonably withhold approval of a franchise transfer if the proposed transferee meets certain conditions. The transferee, or its owners if the transferee is a legal entity, must provide all requested information on a timely basis.
The individuals must be of good character and reputation. They also must have sufficient business experience, aptitude, and financial resources to operate the Checkersrallys restaurant. The proposed transferee may not 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.
These stipulations ensure that any new franchisee stepping into the Checkersrallys system has the necessary qualifications and resources to maintain the brand's standards and operational success. This protects Checkersrallys's interests and the interests of other franchisees within the system.