Under what circumstances related to continuous operation can a Carls Jr. franchisee close their restaurant for more than 5 days without violating the agreement?
Carls_Jr Franchise · 2025 FDDAnswer from 2025 FDD Document
In addition to the grounds for termination that may be stated elsewhere in this Agreement, CJR may terminate this Agreement, and the rights granted by this Agreement, upon written notice to Franchisee without an opportunity to cure upon the occurrence of any of the following events:
- (1) Franchisee ceases to continuously operate the Franchised Restaurant for a period in excess of 5 consecutive days, unless the closing is due to a Force Majeure or is approved in writing in advance by CJR.
If the closing is due to fire or other natural disaster, Franchisee must rebuild and reopen the Franchised Restaurant within six months following the fire or other natural disaster event or such longer period of time as agreed to with CJR.
Source: Item 22 — CONTRACTS (FDD pages 75–76)
What This Means (2025 FDD)
According to the 2025 Carls Jr. Franchise Disclosure Document, a franchisee can close their restaurant for more than 5 consecutive days without facing termination of their franchise agreement under two specific conditions. The first is if the closing is due to a Force Majeure event, which generally refers to unforeseeable circumstances that prevent someone from fulfilling a contract. The second condition is if Carls Jr. provides written approval in advance for the closure.
However, if the closure is due to fire or other natural disaster, the franchisee must rebuild and reopen the restaurant within six months following the event, unless Carls Jr. agrees to a longer period. Failure to meet these conditions could result in Carls Jr. terminating the franchise agreement without an opportunity for the franchisee to correct the issue.
This clause is fairly standard in franchise agreements to ensure consistent brand presence and operational standards. It is important for a prospective Carls Jr. franchisee to understand these stipulations, as failure to adhere to the continuous operation requirement could lead to the loss of their franchise.