Can Checkersrallys operate and change the system in any manner?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
2.04 Reservation of Rights. Except as expressly provided in this Agreement, we and all of our Affiliates (and our respective successors and assigns, by purchase, merger, consolidation or otherwise) retain all of our rights and discretion with respect to the Marks, the System and Restaurants anywhere in the world, and the right to engage in any business whatsoever, including the right to: (a) operate, and grant to others the right to operate, "Checkers" and "Rally's"-branded restaurants at such locations and on such terms and conditions as we deem appropriate; (b) sell any products or services under the Marks or under any other trademarks, service marks or trade dress, through alternative channels of distribution, including without limitation, the internet or similar electronic media and supermarkets; (c) operate, and grant to others the right to operate, restaurants identified by trademarks, service marks or trade dress, other than the Marks, (including the [INSERT
BRAND: "Checkers"/"Rally's"] name and mark) pursuant to such terms and conditions as we deem appropriate; and (d) be acquired (whether through acquisition of assets, ownership interests or otherwise, regardless of the form of transaction), by a business providing products and services similar to those provided at "Checkers" or "Rally's"-branded restaurants, or by another business, even if such business operates, franchises and/or licenses Competitive Businesses in the Development Area.
Source: Item 23 — RECEIPTS (FDD pages 92–384)
What This Means (2025 FDD)
According to Checkersrallys's 2025 Franchise Disclosure Document, Checkersrallys retains significant rights and discretion regarding the Marks, the System, and the Restaurants. Except as expressly provided in the franchise agreement, Checkersrallys and its affiliates reserve the right to operate and grant others the right to operate Checkersrallys-branded restaurants at locations and under terms they deem appropriate. They can also sell products or services under the Marks through alternative channels of distribution, such as the internet or supermarkets.
Checkersrallys also has the right to operate and franchise restaurants under different trademarks than the Checkersrallys Marks, under terms and conditions they consider appropriate. Additionally, Checkersrallys can be acquired by a business providing similar products or services, even if that business operates or franchises competitive businesses within the franchisee's development area.
These stipulations mean that while franchisees have specific rights outlined in their agreements, Checkersrallys maintains broad control over the brand, system, and market, including the ability to modify operations, distribution channels, and even introduce competing brands or be acquired by competitors. This reservation of rights is a common practice in franchising, allowing the franchisor to adapt to market changes and protect the overall brand. However, it also means that franchisees must be aware that Checkersrallys has considerable latitude in how it manages and evolves the brand, which could potentially impact individual franchise operations.