What are the possible lengths of the Renewal Term that a Carls Jr. franchisee can elect?

he Franchised Location through the Initial Term of this Agreement), loses the right to possession of the Franchised Location, the Initial Term shall expire as of the date of the loss of the right to possession. However, if the right to possession is lost through no act or failure to act on Franchisee's part, Franchisee may relocate the Franchised Restaurant (without paying any additional initial franchise fee or transfer fee) at its expense and the Initial Term shall not expire if: (1) CJR accepts the new location; (2) Franchisee constructs and equips a Franchised Restaurant at the new location in accordance with the then-current System Standards and specifications; (3) a Franchised Restaurant at the new location is open to the public for business within 6 months after the loss of possession of the Franchised Location; and (4) Franchisee reimburses CJR for all reasonable expenses actually incurred by CJR in connection with the acceptance of the new location.

B. Renewal Term

• (1) At the expiration of the Initial Term, Franchisee shall have an option to remain a franchisee at the Franchised Location for a Renewal Term of 10 years or, at Franchisee's option, 5 years. Franchisee must give CJR written notice of whether or not it intends to exercise its renewal option and the length of the proposed Renewal Term not less than 12 months, nor more than 24 months, before the expiration of the Initial Term. Notwithstanding the foregoing, if Franchisee subleases the Franchised Location from CJR, Franchisee must give CJR the notice described in the preceding sentence not less than 6 months, nor more than 12 months, before notice of renewal is required to be provided to the landlord under the master lease. Failure by Franchisee to timely provide CJR the required notice constitutes a waiver by Franchisee of its option to remain a franchisee beyond the expiration of the Initial Term.
• (2) If Franchisee desires to continue as a franchisee for the Renewal Term, Franchisee must comply with all of the following conditions prior to and at the end of the Initial Term:
• (a) Franchisee shall not be in default under this Agreement or any other agreements between Franchisee and CJR or its affiliates; Franchisee shall not be in default beyond the applicable cure period under any real estate lease, equipment lease or financing instrument relating to the Franchised Restaurant; Franchisee shall not be in default beyond the applicable cure period with any vendor or supplier to the Franchised Restaurant; and, for the 12 months before the date of Franchisee's notice and the 12 months before the expiration of the Initial Term, Franchisee shall not have been in default beyond the applicable cure period under this Agreement or any other agreements between Franchisee and CJR or its affiliates.
• (b) Franchisee shall make the capital expenditures required to renovate and modernize the Franchised Restaurant to conform to the interior and exterior designs, decor, color schemes, furnishings and equipment and presentation of the Proprietary Marks consistent with the image of the System for new Carl's Jr. Restaurants at the time Franchisee provides CJR the renewal notice, including such structural changes, remodeling, redecoration and modifications to existing improvements as may be necessary to do so.
• (c) Franchisee and its employees at the Franchised Restaurant shall be in compliance with CJR's then-current training requirements.

• (d) Franchisee shall have the right to remain in possession of the Franchised Location, or other premises acceptable to CJR, for the Renewal Term and all monetary obligations owed to Franchisee's landlord, if any, must be current.
• (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.
• (f) As determined by CJR in its sole discretion, Franchisee has operated the Franchised Restaurant and all of its other franchised Carl's Jr. Restaurants in accordance with the applicable franchise agreements and with the System Standards (as set forth in the OPM or otherwise and as revised from time to time by CJR) and has operated each of its other restaurants that are franchised by CJR or its affiliates in accordance with the applicable franchise agreement and system standards.
• (3) Within 4 months after CJR's receipt of Franchisee's written notice of its desire to renew, CJR shall advise Franchisee whether or not Franchisee is entitled to remain a franchisee for the Renewal Term. If CJR intends to permit Franchisee to remain a franchisee for the Renewal Term, CJR's notice will contain preliminary information regarding actions Franchisee must take to satisfy Sections 2.B.(2)(b) and (c). If CJR does not intend to permit Franchisee to remain a franchisee for the Renewal Term, CJR's notice shall specify the reasons for non-renewal. If CJR chooses not to permit Franchisee to remain a franchisee for the Renewal Term, it shall have the right to unilaterally extend the Initial Term of this A

Source: Item 22 — CONTRACTS (FDD pages 75–76)