If Checkersrallys and the franchisee have not agreed upon a location before signing the Franchise Agreement, who is responsible for selecting the site?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
3.02 Selection of Premises.If you have suggested a location for the Franchised Restaurant which we have approved before or concurrently with the execution of this Agreement, the Premises will be set forth on Exhibit B. If we and you have not agreed upon an approved location for the Franchised Restaurant before signing this Agreement, then you are responsible for selecting the site for the Franchised Restaurant within the geographic area described in Exhibit B ("Designated Area"). The Designated Area is delineated for the sole purpose of site selection and does not confer any territorial exclusivity or protection. You agree to obtain our written approval of the Franchised Restaurant's proposed site before signing any lease, sublease, or other document for the site. Within one hundred eighty (180) days after the Effective Date, you must locate and submit for our approval a site acceptable to us within the Designated Area for the Franchised Restaurant. We will use reasonable efforts to help analyze your market area, to help determine site feasibility, and to assist in designating the location, although we will not conduct site selection activities for you. We will not unreasonably withhold our approval of a site that meets our criteria for demographic characteristics; traffic patterns; parking; character of neighborhood; competition from, proximity to, and nature of other businesses; other commercial characteristics; and the proposed site's size, appearance, and other physical characteristics.
Source: Item 22 — CONTRACTS (FDD pages 91–92)
What This Means (2025 FDD)
According to Checkersrallys's 2025 Franchise Disclosure Document, if the franchisee and Checkersrallys have not agreed upon a location before signing the Franchise Agreement, the franchisee is responsible for selecting the site. The site must be within the geographic area described in Exhibit B, referred to as the "Designated Area." This area is specifically for site selection and does not provide any territorial exclusivity or protection for the franchisee.
The franchisee must obtain written approval from Checkersrallys for the proposed site before signing any lease or sublease. The franchisee has 180 days from the Effective Date of the agreement to locate and submit a site for approval. Checkersrallys will offer reasonable assistance in analyzing the market area and determining site feasibility but will not conduct site selection activities directly for the franchisee.
Checkersrallys will not unreasonably withhold approval of a site that meets its criteria, which include demographic characteristics, traffic patterns, parking, neighborhood character, competition, proximity to other businesses, and the site's physical characteristics. If Checkersrallys does not approve a proposed site, the franchisee must continue to identify and submit new sites until one is approved. Upon approval, the site's address will be added to Exhibit B, designating it as the Premises.
If the franchisee cannot find an acceptable site within the Designated Area within the 180-day period, they can request an extension, which Checkersrallys may grant at its discretion. Granting an extension requires the franchisee to pay a nonrefundable fee of $5,000. Failure to locate an acceptable site can result in Checkersrallys terminating the Franchise Agreement.