Under what condition is Carls Jr. not obligated to review a development proposal?
Carls_Jr Franchise · 2025 FDDAnswer from 2025 FDD Document
We will advise you in writing within 45 days after receipt of all documents that we require whether we have accepted a particular site; however, we have no obligation to review any development proposal if you or your affiliates are not in full compliance with all agreements with us or our affiliates. If we do not respond within that time period, we will be deemed not to have accepted the site. (Development Agreement, § 5.D and Franchise Agreement § 4.D.)
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS, AND TRAINING (FDD pages 42–55)
What This Means (2025 FDD)
According to the 2025 Carls Jr. Franchise Disclosure Document, Carls Jr. is not obligated to review a development proposal if the franchisee or their affiliates are not in full compliance with all existing agreements with Carls Jr. or its affiliates. This condition is outlined in Item 11, which discusses the franchisor's assistance, advertising, computer systems, and training provided to franchisees.
This stipulation means that a franchisee must maintain good standing with Carls Jr. to receive site approval assistance. Non-compliance could stem from various breaches of the franchise agreement, such as failure to meet payment obligations, adhere to operational standards, or fulfill reporting requirements. Therefore, franchisees must ensure they remain fully compliant with all contractual obligations to avoid delays or rejection of their development proposals.
This requirement is a protective measure for Carls Jr., ensuring that they only invest resources in franchisees who are committed to upholding the brand's standards and meeting their contractual obligations. For a prospective franchisee, this underscores the importance of understanding and adhering to all terms of the franchise agreement from the outset. Maintaining open communication with Carls Jr. and promptly addressing any compliance issues will be crucial for a franchisee's growth and expansion plans.