What are the Checkers franchise's rights regarding termination if a franchisee fails to locate an acceptable site for the premises?

According to Checkers's 2025 Franchise Disclosure Document, Checkers has the right to terminate the franchise agreement if the franchisee fails to locate and submit an acceptable site for the premises. Specifically, if the franchisee does not secure an approved location, Checkers can terminate the agreement as per Section 3.02 of the agreement.

After signing the franchise agreement, the franchisee is responsible for selecting a site within a designated geographic area outlined in Exhibit B. The franchisee must then obtain Checkers' written approval before signing any lease or purchase agreement for the site. The franchisee typically has 180 days from the effective date of the agreement to find and submit a site for approval. Checkers will offer reasonable assistance in analyzing the market area and determining site feasibility but will not conduct site selection activities for the franchisee.

Checkers will not unreasonably withhold approval of a site that meets its criteria, which include demographic characteristics, traffic patterns, parking, neighborhood character, competition, proximity to other businesses, and the site's physical characteristics. If the franchisee cannot find an acceptable site within the initial 180-day period, they can request an extension, which Checkers may grant at its sole discretion. Granting an extension requires the franchisee to pay a nonrefundable fee of $5,000.

If Checkers approves a site, the address will be added to Exhibit B of the franchise agreement, officially designating it as the premises. However, the failure to add the address to Exhibit B does not automatically affect the enforceability of the agreement. The franchisee's failure to locate and secure an approved site within the given timeframe, even with an extension, can lead to the termination of the franchise agreement by Checkers.