What must a new Carls franchisee do to be eligible to participate in the CJR 2024 Development Incentive Program?
Carls Franchise · 2024 FDDAnswer from 2024 FDD Document
To be eligible for the CJR 2024 Development Incentive Program, an existing franchise must meet the following requirements: (i) sign a Development Agreement or Franchise Agreement for the development of one or more newly-constructed Carl's Jr. Restaurant(s) by no later than May 24, 2025, (ii) franchisee must open the newly-constructed Carl's Jr. Restaurant(s) by the date(s) outlined in the corresponding Development Agreement or Franchise Agreement, (iii) franchisee may not be in default of its obligations under its existing franchise agreements or related agreements with CJR or its affiliates, (iv) franchisee must be approved for growth by CJR and its affiliates, (v) franchisee must satisfy CJR's thencurrent financial and operational requirements for new restaurant development, and (vi) franchisee and the Carl's Jr. Restaurant(s) otherwise meet the requirements of the CJR 2024 Development Incentive Program. New franchisees are also eligible to participate in the CJR Development Incentive Program provided they: (i) sign a Development Agreement or Franchise Agreement for the development of one or more newlyconstructed Carl's Jr. Restaurant(s) by no later than May 24, 2025, (ii) open the newly-constructed Carl's Jr. Restaurant(s) by the date(s) outlined in the corresponding Development Agreement or Franchise Agreement, and (iii) meet the requirements of the CJR 2024 Development Incentive Program.
If you qualify for the CJR 2024 Development Incentive Program, simultaneously with your execution of the qualifying Franchise Agreement, you will sign a CJR 2024 Development Incentive Program Addendum to the Franchise Agreement (Exhibit L), which memorializes your right to receive the development incentives described above for the applicable Franchised Restaurant.
If you sign the CJR 2024 Development Incentive Program Addendum to Franchise Agreement, you will not be entitled, with respect to the applicable Franchised Restaurant covered by the CJR 2024 Development Incentive Program, to any other incentives that have been or may be offered by us.
Source: Item 1 — THE FRANCHISOR, AND ANY PARENTS, PREDECESSORS, AND AFFILIATES (FDD pages 7–19)
What This Means (2024 FDD)
According to Carls's 2024 Franchise Disclosure Document, new franchisees can participate in the CJR 2024 Development Incentive Program if they meet certain requirements. Specifically, a new franchisee must sign a Development Agreement or Franchise Agreement for the development of one or more newly-constructed Carl's Jr. Restaurants by May 24, 2025. They must also open the newly-constructed Carl's Jr. Restaurants by the dates outlined in the corresponding Development Agreement or Franchise Agreement. Finally, the new franchisee must meet all the general requirements of the CJR 2024 Development Incentive Program.
This incentive program appears to be designed to encourage the development of new Carl's Jr. locations. By meeting the specified deadlines for signing agreements and opening restaurants, new franchisees can access the benefits offered under the CJR 2024 Development Incentive Program. It is important to note that eligibility for the program is contingent upon adhering to the timelines and fulfilling all the program's requirements.
If a new franchisee qualifies for the CJR 2024 Development Incentive Program, they will sign a CJR 2024 Development Incentive Program Addendum to the Franchise Agreement. This addendum, which is included as Exhibit L in the Franchise Disclosure Document, formalizes the franchisee's right to receive the development incentives for the applicable franchised restaurant. However, signing this addendum means that the franchisee will not be entitled to any other incentives that Carls may offer.