What are the conditions under which Carls Jr. may charge relocation expenses?
Carls Franchise · 2024 FDDAnswer from 2024 FDD Document
e. | | Costs and Attorneys' Fees | CJR's costs and expenses | As incurred | If we prevail in litigation regarding enforcement of the terms of any agreement with you, you must pay our attorneys' fees and costs. |
| Type of Fee (1) | Amount | Due Date | Remarks |
|---|---|---|---|
| Carl's Jr. Renewal Fee | $5,000 for a renewal term of 5 years or less or $10,000 for a renewal term greater than 5 years, but no more than 10 years | At the time the new franchise agreement is signed | |
| Collection Costs and Expenses | CJR's costs and expenses | On demand, if required | These costs and expenses include, but are not limited to, costs and commissions due a collection agency, reasonable attorneys' fees, costs incurred in creating or replicating reports demonstrating Gross Sales of the Franchised Restaurant, court costs, expert witness fees, discovery costs and reasonable attorneys' fees and costs on appeal, together with interest charges on all of the foregoing. |
| Relocation | CJR's reasonable expenses | On demand, if required | You may not relocate the Franchised Restaurant without CJR's prior written consent, which may be withheld by CJR in its sole discretion. If we approve a relocation of your Franchised Restaurant, we have the right to charge you for all reasonable expenses actually incurred in connection with consideration of the request. |
| Reimbursement of Insurance Costs | Cost of obtaining coverage | Immediately upon receipt of invoice | If you fail to procure or maintain the required insurance, we may procure the insurance and charge its cost along with our out-of-pocket expenses to you. We collect the cost of the insurance coverage for the insurance company with which we place the coverage. |
| Web Site Fee | Actual co |
Source: Item 6 — Other Fees (FDD pages 26–31)
What This Means (2024 FDD)
According to the 2024 FDD, Carls may charge a franchisee relocation expenses under specific conditions. A franchisee cannot relocate their Carls restaurant without prior written consent from Carls; such consent can be withheld at Carls's discretion.
Should Carls approve a relocation, the franchisee is responsible for paying Carls's reasonable expenses actually incurred while considering the relocation request. The FDD specifies that these relocation expenses are due on demand, if required by Carls.
In practical terms, this means that if a Carls franchisee wants to move their restaurant to a new location, they must first get approval from Carls. Even if approval is granted, the franchisee will have to cover Carls's costs associated with evaluating the relocation request. This could include administrative costs, site visits, or other related expenses. Franchisees should carefully consider these potential costs before deciding to request a relocation.