Under what conditions might Checkersrallys refund 50% of the 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 may be eligible for a refund of 50% of the initial franchise fee under specific circumstances. The initial franchise fee is generally non-refundable once the Franchise Agreement's effective date has passed.
However, Checkersrallys may refund fifty percent of the initial franchise fee if the franchisee meets certain conditions. First, the franchisee must be unable to secure a site acceptable to Checkersrallys within the designated area and timeframe outlined in Section 3.02 of the Franchise Agreement. Alternatively, despite making good faith efforts, the franchisee could not obtain all necessary permits, licenses, or other regulatory or municipal approvals to open the franchised restaurant within 60 days after executing the lease, sublease, or purchase agreement for the premises.
In addition to meeting one of the above conditions, the franchisee and their owners must execute general releases, in a form and substance satisfactory to Checkersrallys, of any and all claims against Checkersrallys, its affiliates, officers, directors, employees, agents, successors, and assigns. This release protects Checkersrallys from any potential legal action related to the failed franchise opening. Therefore, to receive the 50% refund, a franchisee must not only face specific setbacks in securing a location or necessary permits but also agree to release Checkersrallys from any liability.