What must a Checkersrallys franchisee do to maintain development rights during the term of the agreement?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
2.02 Development Rights. During the Term and provided you and your Affiliates are in compliance with this Agreement and all other agreements with us or any of our Affiliates (including Franchise Agreements signed pursuant to this Agreement), we will: (a) grant to you,
2.03 Development Obligations. You agree to exert your best efforts to fully develop the market potential for Restaurants in the Development Area. Without limiting the foregoing, you agree to open and operate in the Development Area, in accordance with and pursuant to Franchise Agreements, those cumulative numbers of Restaurants set forth in Section 3(a) of Exhibit A by the corresponding dates set forth therein and to achieve those cumulative numbers in accordance with the timelines set forth in Section 3(b) of Exhibit A (those dates and timelines collectively referred to herein as the "Development Schedule"). Time is of the essence in this Agreement, and we have no obligation under any circumstances to extend any of the dates or timelines in the Development Schedule.
Source: Item 23 — RECEIPTS (FDD pages 92–384)
What This Means (2025 FDD)
According to Checkersrallys's 2025 Franchise Disclosure Document, to maintain development rights during the term of the agreement, a franchisee and their affiliates must be in compliance with the Development Agreement and all other agreements with Checkersrallys or any of its affiliates. This includes any Franchise Agreements signed pursuant to the Development Agreement. Compliance is essential for Checkersrallys to grant the franchisee the agreed-upon development rights.
Furthermore, the franchisee must exert their best efforts to fully develop the market potential for Checkersrallys restaurants in the designated Development Area. This involves opening and operating the cumulative number of restaurants as outlined in Section 3(a) of Exhibit A by the corresponding dates specified in Section 3(b) of Exhibit A, referred to as the "Development Schedule." Meeting these development obligations within the given timelines is critical, as Checkersrallys has no obligation to extend any dates or timelines within the Development Schedule.
Time is of the essence in the Development Agreement, meaning that strict adherence to the schedule is required. Failure to meet these obligations could result in the termination of the development rights. Prospective franchisees should carefully review Exhibit A to understand the specific development schedule and ensure they have the resources and capabilities to meet these requirements.