In the context of the Lease Addendum for Carls Jr., who is designated as the 'Tenant'?
Carls_Jr Franchise · 2025 FDDAnswer from 2025 FDD Document
RECITALS:
Pursuant to the Lease, Landlord will lease or has leased to Tenant certain real property as defined in the Lease ("Premises") for the operation of a franchised Carl's Jr. Restaurant ("Restaurant");
Tenant will develop and operate the Restaurant pursuant to a franchise agreement (the "Franchise Agreement") with Carl's Jr. Restaurants LLC or its affiliates (collectively "CJR"), and the Lease is contingent upon Tenant's execution of the Franchise Agreement with CJR; and
The Franchise Agreement requires, among other things, that the Lease contain certain provisions. Landlord and Tenant desire to modify the Lease to add those required provisions as set forth below, and agree that the terms and provisions of this Lease Addendum are hereby deemed incorporated into and made a part of the Lease.
Source: Item 23 — RECEIPTS (FDD pages 76–364)
What This Means (2025 FDD)
According to the 2025 Carls Jr. Franchise Disclosure Document, the Lease Addendum specifies the 'Tenant' as the entity that will lease the property for operating the franchised Carls Jr. Restaurant. This 'Tenant' is the franchisee who enters into the lease agreement with the landlord. The Lease Addendum modifies the original lease to include provisions required by the Franchise Agreement between the franchisee and Carls Jr. Restaurants LLC (CJR).
The Lease Addendum outlines several rights and responsibilities of both the Landlord and the Tenant. For example, the tenant is responsible for all obligations, debts, and payments under the lease, not CJR. The tenant also has the right to make alterations and modifications to the premises after the lease or franchise agreement terminates, ensuring the location is no longer identifiable as a Carls Jr. restaurant.
Carls Jr. (CJR) maintains certain rights as a third-party beneficiary to protect its brand and system. CJR can enter the premises to make modifications, cure defaults, and ensure compliance with Carls Jr. standards. Additionally, the tenant may assign the lease to CJR or its affiliates under certain conditions, and CJR has the option to assume the lease under specific circumstances, such as the tenant failing to renew the lease. These provisions ensure that Carls Jr. has mechanisms to maintain control over the restaurant location and protect its brand identity, even if the franchisee's involvement changes.