Must a Carls Jr. franchisee and its affiliates be in compliance with all agreements with CJR to transfer the franchise?

According to the 2025 Carls Jr. Franchise Disclosure Document, a franchisee and its affiliates must be in compliance with all obligations to CJR or its affiliates under existing agreements to transfer a franchise. Specifically, the transferee and each of the transferee's affiliates that have entered into a development or franchise agreement with CJR or its affiliates must be in compliance with all obligations to CJR or its affiliates under those agreements as of the date of the request for CJR's consent to the transfer.

This requirement ensures that all parties involved in the transfer, including the franchisee, its affiliates, and the potential transferee, are in good standing with Carls Jr. This protects the brand's integrity and ensures that new franchisees are financially and operationally sound.

For a prospective Carls Jr. franchisee, this means that if they plan to transfer their franchise in the future, they must maintain compliance with all agreements. This includes timely payments, adherence to operational standards, and fulfillment of any other contractual obligations. Failure to do so could prevent the transfer from being approved by Carls Jr.