Under what condition will Checkersrallys refund the uncredited portion of the development fee?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
imate can be developed within the Development Area.
Under the Development Agreement, you are required to pay the then-current standard initial franchise fee for each Restaurant you are required to develop under a Development Agreement; however, $10,000 of the development fee is credited to the initial franchise fee payable for each Restaurant you are required to open under the Development Agreement until the development fee is credited in full. The development fee is not refundable, in whole or in part, except if we terminate the Development Agreement as a result of adverse franchise legislation. In this event, we will r
Source: Item 5 — INITIAL FEES (FDD pages 17–21)
What This Means (2025 FDD)
According to Checkersrallys's 2025 Franchise Disclosure Document, the development fee, which is $10,000 per restaurant to be developed under a Development Agreement, is generally non-refundable. However, there is one specific circumstance under which Checkersrallys will refund the uncredited portion of the development fee.
Specifically, if Checkersrallys terminates the Development Agreement due to adverse franchise legislation, the company will refund the uncredited portion of the development fee to the franchisee. This means that if a law is passed that negatively impacts the franchise agreement, leading Checkersrallys to terminate the agreement, the franchisee will receive back the amount of the development fee that has not yet been applied to initial franchise fees for opened restaurants.
This condition provides a limited protection for franchisees against legislative changes that could undermine the franchise agreement. It is important for prospective franchisees to understand that this is the only scenario under which a refund of the development fee is provided, highlighting the importance of carefully considering the risks and benefits before entering into a Development Agreement with Checkersrallys.