What is Carls' requirement for franchisees regarding the use of the Franchised Location during the term of the Agreement?

According to Carls's 2024 Franchise Disclosure Document, franchisees must use the Franchised Location solely for the operation of their Carls restaurant. Franchisees are expected to maintain sufficient inventory, staff each shift with qualified employees, and continuously operate the restaurant at its maximum capacity and efficiency. This is subject to the minimum number of days and hours outlined in the Operations Procedures Manual (OPM) or as otherwise prescribed by Carls in writing, while also adhering to local laws and licensing requirements.

This requirement ensures that each Carls location operates consistently and effectively, contributing to the overall brand image and customer experience. By mandating maximum capacity and efficiency, Carls aims to optimize sales and profitability for both the franchisee and the brand. Franchisees must adhere to these operational standards throughout the term of their agreement.

Failure to comply with these requirements could lead to a breach of the franchise agreement. Carls retains the right to enforce these standards to maintain the quality and consistency of its brand. Prospective franchisees should carefully review the OPM and any written directives from Carls to fully understand these operational obligations.