What constitutes a waiver of the renewal option for a Carls franchise?

According to Carls's 2024 Franchise Disclosure Document, a franchisee's failure to provide timely written notice to CJR (Carls Jr. Restaurants) regarding their intent to exercise the renewal option constitutes a waiver of the option to remain a franchisee beyond the initial term. This notice must specify whether the franchisee desires a renewal term of 10 years or 5 years.

Specifically, the franchisee must provide this written notice not less than 12 months, nor more than 24 months, before the expiration of the initial term. However, if the franchisee subleases the franchised location from CJR, the notice period is shorter: not less than 6 months, nor more than 12 months, before notice of renewal is required to be provided to the landlord under the master lease.

In addition to providing timely notice, the franchisee must also execute and return the renewal franchise agreement, along with the renewal fee, to CJR at least one month prior to the expiration of the initial term. Failure to do so may, at Carls's option, be deemed an election by the franchisee not to renew the franchise, resulting in the termination of the franchise agreement at the end of the initial term. Therefore, franchisees must adhere strictly to the notification deadlines and agreement execution requirements to avoid waiving their renewal rights.