After the Checkersrallys agreement is terminated or expires, for how long is a franchisee restricted from operating a competing business?

Question

Accepted Answer

|    | PROVISION                                                                          | SECTION IN FRANCHISE OR OTHER AGREEMENT | SUMMARY                                                                                                                                                                                                                                                                                                                                                                                                                                |
|----|------------------------------------------------------------------------------------|-----------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| m. | Conditions for franchisor's approval of transfer | Section 13.02 | Restaurant must have opened. Transferee must qualify, complete training, sign existing or new agreement and pay transfer fee; you must guaranty transferee obligations; transferee cannot be public company. You must transfer all of your Restaurants; be in compliance with agreements; subordinate debts and sign a release and non-compete for each transferred Restaurant; we must approve price and payment terms; transferee must agree to remodel; you must execute such other documents that we may reasonably require to protect our rights under the Franchise Agreement and any development agreement. |
| n. | Franchisor's right of first refusal | Section 13.06 | We can match any offer for your business. |
| o. | Franchisor's option to purchase franchisee's franchise | Section 16.04 | We may acquire your Franchised Restaurant upon expiration (without renewal) at fair market value and upon termination at appraised asset value or net book value, whichever is less. |
| p. | Death or disability of franchisee | Section 13.05 | Franchise must be assigned by estate within nine months to a third party we have approved. |
| q. | Non-competition covenants during the term of the franchise | Section 7.02 | No involvement in any competing business regardless of its location. |
| r. | Non-competition covenants after the franchise is terminated or expires | Section 16.03 | No competing business for 2 years at the Premises of your Franchised Restaurant, or within 3 miles of your Franchised Restaurant or any other Checkers Restaurant or Rally's Restaurant. |
| s.

Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION THE FRANCHISE RELATIONSHIP (FDD pages 66–71)

After the Checkersrallys agreement is terminated or expires, for how long is a franchisee restricted from operating a competing business?

Answer from 2025 FDD Document

What This Means (2025 FDD)

	PROVISION	SECTION IN FRANCHISE OR OTHER AGREEMENT	SUMMARY
m.	Conditions for franchisor's approval of transfer	Section 13.02	Restaurant must have opened. Transferee must qualify, complete training, sign existing or new agreement and pay transfer fee; you must guaranty transferee obligations; transferee cannot be public company. You must transfer all of your Restaurants; be in compliance with agreements; subordinate debts and sign a release and non-compete for each transferred Restaurant; we must approve price and payment terms; transferee must agree to remodel; you must execute such other documents that we may reasonably require to protect our rights under the Franchise Agreement and any development agreement.
n.	Franchisor's right of first refusal	Section 13.06	We can match any offer for your business.
o.	Franchisor's option to purchase franchisee's franchise	Section 16.04	We may acquire your Franchised Restaurant upon expiration (without renewal) at fair market value and upon termination at appraised asset value or net book value, whichever is less.
p.	Death or disability of franchisee	Section 13.05	Franchise must be assigned by estate within nine months to a third party we have approved.
q.	Non-competition covenants during the term of the franchise	Section 7.02	No involvement in any competing business regardless of its location.
r.	Non-competition covenants after the franchise is terminated or expires	Section 16.03	No competing business for 2 years at the Premises of your Franchised Restaurant, or within 3 miles of your Franchised Restaurant or any other Checkers Restaurant or Rally's Restaurant.
s.