How much are Carls Jr. franchisees required to contribute to the Media Fund, as detailed in Appendix C?
Carls_Jr Franchise · 2025 FDDAnswer from 2025 FDD Document
CJR has established and will maintain and administer a fund for working media costs ("Media Fund"). Franchisee shall contribute to the Media Fund the amount set forth in Appendix C, as subsequently modified pursuant to Section 8.F. Carl's Jr. Restaurants operated by CJR and its affiliates shall contribute to the Media Fund on the same basis as comparable franchisees.
During the term of this Agreement, Franchisee shall have a weekly advertising and promotion obligation ("APO") in the amount set forth in Section 6.C. and Appendix C. Following written notice to Franchisee, CJR may modify the amount and allocation of the APO subject to the provisions of Section 8.F. Franchisee shall pay, at the same time and in the same manner as the royalty fee, that portion of the APO as CJR may direct to the Production Fund in accordance with Section 8.B. The remainder of the APO shall be paid, at the same time and in the same manner as the royalty fee, to the Media Fund in accordance with Section 8.C.
Source: Item 22 — CONTRACTS (FDD pages 75–76)
What This Means (2025 FDD)
According to Carls Jr.'s 2025 Franchise Disclosure Document, franchisees are required to contribute to the Media Fund, with the specific amount outlined in Appendix C. This fund is designated for covering the costs associated with media activities. Carls Jr. restaurants operated by the company itself and its affiliates contribute to the Media Fund on the same terms as their franchisees.
In addition to the Media Fund, franchisees also have a weekly advertising and promotion obligation (APO), as detailed in Section 6.C. and Appendix C. Carls Jr. retains the right to modify the amount and allocation of the APO with written notice to the franchisee, as per Section 8.F. A portion of this APO is directed towards the Production Fund, as outlined in Section 8.B, while the remaining amount is allocated to the Media Fund, in accordance with Section 8.C.
Appendix C is referenced as the location for the specific contribution amounts for both the Media Fund and the overall advertising and promotion obligations. Prospective franchisees should carefully review Appendix C of the Franchise Agreement to understand the financial commitments required for advertising and promotional activities. Understanding these obligations is crucial for assessing the overall cost and potential profitability of a Carls Jr. franchise.