Does Checkers have the right to approve the terms of any lease, sublease, or purchase contract for the premises of my franchised restaurant?
Checkers Franchise · 2025 FDDAnswer from 2025 FDD Document
We have the right to approve the terms of any lease, sublease or purchase contract for the Premises of your Franchised Restaurant. Any lease or sublease for the Premises must contain certain provisions detailed in our required form of franchise addendum to lease agreement (the "Lease Addendum"), the current form of which we include as an exhibit attached to the Franchise Agreement.
If we agree to sublease the Premises to you, you are required to pay the rent under the sublease to the landlord of the Premises, along with the related occupancy costs, which include property taxes, insurance, maintenance and structural repairs. We derive revenue from this subleasing arrangement, as detailed in Item 6.
Source: Item 8 — RESTRICTIONS ON SOURCES OF PRODUCTS AND SERVICES (FDD pages 39–44)
What This Means (2025 FDD)
According to Checkers' 2025 Franchise Disclosure Document, Checkers retains the right to approve the terms of any lease, sublease, or purchase contract for the premises of your franchised restaurant. This means that as a prospective franchisee, you cannot finalize any agreement regarding the location of your Checkers restaurant without Checkers' explicit consent. This approval process is in place to ensure that the location aligns with Checkers' standards and business interests.
Furthermore, any lease or sublease for the premises must include specific provisions detailed in Checkers' required form of franchise addendum to lease agreement, referred to as the "Lease Addendum," which is attached as an exhibit to the Franchise Agreement. This addendum likely outlines the responsibilities and obligations of both the franchisee and Checkers, as well as any specific requirements for the lease agreement itself.
If Checkers agrees to sublease the premises to you, you are responsible for paying rent directly to the landlord, along with all related occupancy costs, including property taxes, insurance, maintenance, and structural repairs. Checkers derives revenue from this subleasing arrangement, as detailed in Item 6 of the FDD. This arrangement means that while you're paying the landlord, Checkers is acting as an intermediary and potentially profiting from the sublease. Therefore, it is crucial to carefully review Item 6 to understand the financial implications of this subleasing arrangement.