What is the geographic radius around a Checkers restaurant within which a former franchisee is prohibited from operating a Competitive Business after termination?
Checkers Franchise · 2025 FDDAnswer from 2025 FDD Document
Upon the expiration or other termination for any reason of my employment, association, service or ownership participation, I agree:
(i) to return immediately to Franchisor or Franchisee, as the case may be, all Confidential Information, and any material(s) containing a subset thereof, in my possession that was utilized, or to which I had access,
- during my employment, association, service or ownership participation;
- (ii) to refrain, beginning upon such expiration or termination and forever thereafter, from any and all contacts with customers of Restaurants for any purpose whatsoever; and
- (iii) for a period of two (2) years, starting on the effective date of termination or expiration of my employment/service/association or ownership participation, to refrain from directly or indirectly (such as through any one or more of my spouse, legally-recognized domestic partner, parents, children or sibling(s) (collectively, "Immediate Family")) owning a legal or beneficial interest in, or render services or give advice to: (a) any Competitive Business operating at the Premises or within a three (3)-mile radius of the Premises; (b) any Competitive Business operating within a radius of three (3) miles of any Restaurant in operation or under construction on the effective date of termination or expiration of my employment/service/association/ ownership participation; or (c) any entity which grants franchises, licenses or other interests to others to operate any Competitive Business.
Source: Item 22 — CONTRACTS (FDD pages 91–92)
What This Means (2025 FDD)
According to Checkers' 2025 Franchise Disclosure Document, a former franchisee is restricted from engaging in a Competitive Business within a specific radius of existing Checkers restaurants. This restriction applies for a period of two years following the termination or expiration of their franchise agreement.
Specifically, the franchisee (or their Immediate Family) cannot own a legal or beneficial interest in, or provide services or advice to, any Competitive Business operating at the former franchise location or within a three-mile radius of that location. The restriction also extends to any Competitive Business operating within a three-mile radius of any Checkers restaurant that is either in operation or under construction at the time of termination or expiration. Furthermore, the franchisee is prohibited from being involved with any entity that grants franchises or licenses to others for operating a Competitive Business.
A "Competitive Business" is defined as any business that operates as a restaurant or food-service provider deriving more than 20% of its revenue from selling hamburgers, cheeseburgers, and hot dogs in a fast-food, quick-service, drive-thru, or drive-in format. It also includes businesses that grant franchises or licenses to others to operate such restaurants, excluding Checkers or Rally's branded restaurants franchised by Checkers itself. This non-compete agreement is designed to protect Checkers' interests and maintain its market position by preventing former franchisees from directly competing using the knowledge and experience gained during their time with the franchise.