What happens if the franchisee and its affiliates are not current on all obligations due to CJR and its affiliates, regarding the opening of a Carls restaurant?
Carls Franchise · 2024 FDDAnswer from 2024 FDD Document
- B. Franchisee and its affiliates are current on all obligations due CJR and its affiliates.
- J. Provided all of the preceding conditions have been met, CJR will notify Franchisee of its approval to open the Franchised Restaurant. Notwithstanding the foregoing, CJR has the right to waive any of the foregoing conditions.
Source: Item 22 — CONTRACTS (FDD page 80)
What This Means (2024 FDD)
According to Carls's 2024 Franchise Disclosure Document, if a franchisee and its affiliates are not current on all obligations due to CJR (Carls Jr. Restaurants) and its affiliates, then CJR will not approve the opening of the franchised restaurant.
Specifically, before Carls will notify a franchisee of its approval to open a franchised restaurant, the franchisee and its affiliates must be current on all obligations due CJR and its affiliates. However, Carls retains the right to waive any of the conditions it sets out for opening a restaurant.
This requirement ensures that franchisees are in good financial standing with Carls before commencing operations. For a prospective franchisee, this means maintaining diligent financial records and ensuring all payments to Carls and its affiliates are up-to-date to avoid delays in opening their restaurant. It is important to note that Carls reserves the right to waive any of these conditions, providing a degree of flexibility in the opening process.