What actions must a Checkersrallys franchisee continuously and diligently take during the 6-month period after a restaurant closes to have it count as open for that period?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
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- For purposes of the chart in Section 3(a), above, a Restaurant that is permanently closed after having been opened, other than as a result of noncompliance by you with the terms of the applicable Franchise Agreement, shall be deemed open for a period of 6 months after the last day it was open for business, provided that: (i) during such period of time, you continuously and diligently take such actions as may be required to develop and open a substitute Restaurant within the Development Area pursuant to a new Franchise Agreement therefor; and (ii) by the end of such period you have the substitute Restaurant open and operating in compliance with the Franchise Agreement therefor.
Source: Item 23 — RECEIPTS (FDD pages 92–384)
What This Means (2025 FDD)
According to Checkersrallys's 2025 Franchise Disclosure Document, a restaurant that is permanently closed after having been opened, other than due to the franchisee's noncompliance with the Franchise Agreement, will be considered open for six months after its last day of operation if certain conditions are met.
During this six-month period, the franchisee must continuously and diligently take actions required to develop and open a substitute Checkersrallys restaurant within the Development Area. This must be done under a new Franchise Agreement.
Furthermore, by the end of the six-month period, the franchisee must have the substitute Checkersrallys restaurant open and operating in compliance with its Franchise Agreement. This provision allows the franchisee to maintain certain benefits or avoid penalties tied to continuous operation, provided they are actively working to replace the closed location with a new one.