Under what conditions can Checkersrallys terminate the Development Agreement with cause?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
| PROVISION | SECTION IN FRANCHISE OR OTHER AGREEMENT | SUMMARY | |
|---|---|---|---|
| f. | Termination by franchisor with cause | Section 8 | We can terminate only for specified causes (if we terminate, we may also terminate any franchise agreements you have signed with us) |
| g. | "Cause" defined: curable defaults | Section 8.02 | 30 days to cure certain breaches of the Development Agreement. |
| h. | "Cause" defined non-curable defaults | Sections 8.01 and 8.02 | Includes insolvency; failure to meet development schedule; unauthorized transfer; misrepresentations; conviction of a felony; unauthorized disclosure of confidential information; any default by you under a franchise agreement; adverse franchise legislation. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION THE FRANCHISE RELATIONSHIP (FDD pages 66–71)
What This Means (2025 FDD)
According to Checkersrallys's 2025 Franchise Disclosure Document, Checkersrallys can terminate the Development Agreement with cause under specific conditions, as detailed in Section 8 of the agreement. These causes are divided into curable and non-curable defaults. For curable defaults, the developer typically has 30 days to correct the breach, as specified in Section 8.02.
Non-curable defaults, outlined in Sections 8.01 and 8.02, include more severe issues such as insolvency, failure to meet the development schedule agreed upon, unauthorized transfer of the agreement, misrepresentations made to Checkersrallys, conviction of a felony, unauthorized disclosure of confidential information, any default under a franchise agreement with Checkersrallys, or adverse franchise legislation affecting the agreement.
It's important to note that if Checkersrallys terminates the Development Agreement for cause, they may also terminate any existing franchise agreements the developer has with them. This highlights the interconnectedness of the agreements and the potential consequences of failing to meet the obligations outlined in the Development Agreement. Prospective developers should carefully review Section 8 of the Development Agreement to fully understand the circumstances that could lead to termination and the potential ramifications.