Does the Rider for Checkersrallys relate to a waiver of disclaimer of reliance?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
into pursuant to the Development Agreement. | pre-opening obligations under the first franchise agreement | | | 3. | | | | | No disclaimer, questionnaire, clause, or statement signed by a franchisee in connection | | | | | with the commencement of the franchise relationship shall be construed or interpreted as | | | | | waiving any claim of fraud in the inducement, whether common law or statutory, or as | | | | | disclaiming reliance on or the right to rely upon any statement made or information provided | | | | | by any franchisor, broker or other person acting on behalf of the franchisor that was a | | | | | material inducement to a franchisee's investment. This provision supersedes any other or | | | | | inconsistent term of any document executed in connection with the franchise. | CHECKERS DRIVE-IN RESTAURANTS, INC. A Delaware Corporation | AREA FRANCHISEE | | | By: | | By: | | Title: Title:
RIDER TO THE CHECKERS DRIVE-IN RESTAURANTS, INC. FRANCHISE AGREEMENT FOR USE IN CALIFORNIA, INDIANA, MICHIGAN, RHODE ISLAND, AND WISCONSIN
| This Rider | (the "Rider") is made and entered into by and between CHECKERS | |
|---|---|---|
| DRIVE-IN RESTAURANTS, INC., a Delaware | corporation located at 4300 West Cypress | |
| Street, Suite 710, Tampa, Florida | 33607 ("Franchisor"), and | |
| , whose | principal business address is | |
| ("Franchisee"). | ||
| 1. Background. Franchisor and Franchisee are parties to that certain Franchise | The following | |
| Agreement that has been signed at the same time as the signing of this Rider (the | ||
| "Franchise Agreement"). This Rider is part of the Franchise Agreement. | ||
| 2. | ||
| No Waiver of Disclaimer of Reliance in Certain States. | ||
| provision applies only to franchisees and franchises that are subject to the state franchise | ||
| disclosure laws in California, Indiana, Michigan, Rhode Island, or Wisconsin: | ||
| No statement, questionnaire or acknowledgment signed or agreed to by a franchisee | ||
| in connection with the commencement of the franchise relationship shall have the effect of (i) | ||
| waiving any claims under any applicable state franchise law, including fraud in | ||
| the | ||
| inducement, or (ii) disclaiming reliance on any statement made by any franchisor, franchise | ||
| seller, or any other person acting on behalf of the franchisor. This provision supersedes any | ||
| other term of any document executed in connection with the franchise. | ||
| IN WITNESS WHEREOF, the parties have executed and delivered this Rider | ||
| effective on the Effective Date stated in the Franchise Agreement. | ||
| CHECKERS DRIVE-IN RESTAURANTS, INC. | FRANCHISEE | |
| A Delaware Corporation | ||
| By: | By: |
Title: Title:
EXHIBIT K
SAMPLE GENERAL RELEASE
CHECKERS DRIVE-IN RESTAURANTS, INC. GRANT OF FRANCHISOR CONSENT AND FRANCHISEE RELEASE
| Checkers Drive-In Restaurants, Inc. ("we," "us," or "our") and the undersigned |
|---|
| franchisee, ("you" or "your"), |
| currently are parties to a certain Franchise Agreement (the "Franchise Agreement") dated |
| You have asked us to take the following action or to agree to |
| the following request: [insert as appropriate for renewal or transfer situation] |
| . We have the right under the Franchise Agreement to obtain a general |
| release from you (and, if applicable, your owners) as a condition of taking this action or |
| agreeing to this request. Therefore, we are willing to take the action or agree to the request |
| specified above if you (and, if applicable, your owners) |
| give us the release and covenant not |
| to sue provided below in this document. You (and, if applicable, your owners) are willing to |
| give us the release and covenant not to sue provided below as partial consideration for our |
| willingness to take the action or agree to the request described above. |
Consistent with the previous introduction, you, on your own behalf and on behalf of your successors, heirs, executors, administrators, personal representatives, agents, assigns, partners, shareholders, members, directors, officers, principals, employees, and affiliated entities (collectively, the "Releasing Parties"), hereby forever release and discharge us and our current and former officers, directors, shareholders, principals, employees, agents, representatives, affiliated entities, successors, and assigns (collectively, the "Checkers Parties") from any and all claims, damages (known and unknown), demands, causes of action, suits, duties, liabilities, and agreements of any nature and kind (collectively, "Claims") that you and any of the other Releasing Parties now has, ever had, or, but for this document, hereafter would or could have against any of the Checkers Parties (1) arising out of or related to the Checkers Parties' obligations under the Franchise Agreement or (2) otherwise arising from or related to your and the other Releasing Parties' relationship, from the beginning of time to the date of your signature below, with any of the Checkers Parties. You, on your own behalf and on behalf of the other Releasing Parties, further covenant not to sue any of the Checkers Parties on any of the Claims released by this paragraph and represent that you have not assigned any of the Claims released by this paragraph to any individual or entity who is not bound by this paragraph.
We also are entitled to a release and covenant not to sue from your owners. By his, her, or their separate signatures below, your transferring owners likewise grant to us the release and covenant not to sue provided above.
[Signature Page Follows]
Checkers/Rally's April 2025
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The following language applies only to transactions governed by the Maryland Franchise Registration and Disclosure Law
The release provided above will not apply to the extent prohibited by the Maryland Franchise Registration and Disclosure Law. Subject to your arbitration obligation under the Franchise Agreement, you may commence a lawsuit against us in Maryland for claims arising under the Maryland Franchise Registration and Disclosure Law.
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| CHECKERS DRIVE-IN RESTAURANTS, INC.
Source: Item 23 — RECEIPTS (FDD pages 92–384)
What This Means (2025 FDD)
According to the 2025 Checkersrallys Franchise Disclosure Document, the Rider does address the issue of waivers and disclaimers of reliance. Specifically, the Rider includes provisions that prevent franchisees from waiving claims of fraud or disclaiming reliance on statements made by Checkersrallys or its representatives. This means that franchisees retain their legal rights and protections, particularly concerning any misrepresentations or fraudulent inducements made during the franchise sales process. These protections are especially relevant in states with franchise disclosure laws like California, Indiana, Michigan, Rhode Island, and Wisconsin, where such waivers are explicitly prohibited.
For prospective Checkersrallys franchisees, this is a significant safeguard. It ensures that any documents signed during the franchise commencement cannot be used to waive their right to pursue legal action if they believe they were misled or defrauded by Checkersrallys. This provision supersedes any other conflicting terms in any document executed in connection with the franchise agreement, reinforcing the franchisee's protection.
Furthermore, the FDD includes addenda for specific states like Maryland and New York, which provide additional protections. For instance, in Maryland, general releases signed by franchisees will not apply to liabilities under the Maryland Franchise Registration and Disclosure Law. Similarly, New York law ensures that franchisees retain all rights and causes of action arising from the New York General Business Law, preventing any waiver of these rights. These state-specific addenda highlight Checkersrallys's compliance with various state franchise laws and its commitment to protecting franchisees' legal rights.
In Virginia, the Rider ensures that no disclaimer, questionnaire, clause, or statement signed by a franchisee can be interpreted as waiving claims of fraud or disclaiming reliance on statements made by Checkersrallys. This consistent approach across different states demonstrates Checkersrallys's intention to provide a baseline level of protection to all franchisees, regardless of location, while also adhering to specific state regulations.