What legal documents must a Carls Jr. franchisee execute to be eligible for renewal?
Carls_Jr Franchise · 2025 FDDAnswer from 2025 FDD Document
- (e) Franchisee, all individuals who executed this Agreement and all guarantors of Franchisee's obligations shall have executed a general release and a covenant not to sue, in a form satisfactory to CJR, of any and all claims against CJR and its affiliates and their respective past and present officers, directors, managers, shareholders, members, agents and employees, in their corporate and individual capacities, including, without limitation, claims arising under federal, state and local laws, rules and ordinances, and claims arising out of, or relating to, this Agreement, any other agreements between Franchisee and CJR or its affiliates and Franchisee's operation of the Franchised Restaurant, other Carl's Jr.
Restaurants operated by Franchisee and all other restaurants operated by Franchisee that are franchised by CJR or its affiliates.
- (6) Franchisee shall execute the renewal franchise agreement for the Renewal Term and return the signed agreement to CJR, along with the renewal fee, at least one month prior to the expiration of the Initial Term.
Source: Item 22 — CONTRACTS (FDD pages 75–76)
What This Means (2025 FDD)
According to the 2025 Carls Jr. Franchise Disclosure Document, to be eligible for a renewal term, a franchisee must execute a general release and a covenant not to sue, in a form satisfactory to CJR. This release covers any and all claims against CJR and its affiliates, including their officers, directors, managers, shareholders, members, agents, and employees, in both their corporate and individual capacities. The claims include those arising under federal, state, and local laws, rules, and ordinances, as well as claims related to the franchise agreement, any other agreements between the franchisee and CJR, and the franchisee's operation of Carl's Jr. restaurants.
In addition to the release and covenant not to sue, the Carls Jr. franchisee must execute the renewal franchise agreement for the renewal term and return the signed agreement to CJR at least one month prior to the expiration of the initial term. The renewal franchise agreement will be in the form then in general use by CJR for Carl's Jr. restaurants and may differ from the original agreement, particularly in provisions relating to the royalty fee and advertising obligations.
These requirements ensure that Carls Jr. can continue its relationship with franchisees who are committed to the brand and who are willing to resolve any potential disputes before entering into a new franchise term. The renewal fee is $5,000 for a 5-year renewal term or $10,000 for a 10-year renewal term.