What is the Carls Jr. Renewal Fee for a renewal term of 5 years?
Carls_Jr Franchise · 2025 FDDAnswer from 2025 FDD Document
dates | Actual cost of updates | As incurred | The Franchise Agreement gives us the right to require you, at your expense, to use any software or other technology that we may designate or develop in the future. |
| Type of Fee (1) | Amount | Due Date | Remarks |
|---|---|---|---|
| Costs and Attorneys' Fees | CJR's costs and expenses | As incurred | If we prevail in litigation regarding enforcement of the terms of any agreement with you, you must pay our attorneys' fees and costs. |
| Carl's Jr. Renewal Fee | $5,000 for a renewal term of 5 years; $10,000 for a renewal term of 10 years | At the time the new franchise agreement is signed | We reserve the right to prorate the Renewal Fee to align with a renewal term with a corresponding lease expiration date. |
| Liquidated Damages | As calculated (see Remarks) | As incurred | If the Franchise Agreement is terminated following your default, since it would be difficult, if not impossible, to determine the amount of damages that we will suffer as a result of your breach, unless waived by us in our sole discretion, you must immediately pay us, as damages and not as a penalty, the amount of the royalty fee that you would have paid during the period ("Damages Period") from the effective date of termination to the earlier of: (a) the 3-year anniversary of the effective date of termination; or (b) the date on which the initial term of the Franchise Agreement was scheduled to expire. The amount of such royalty fee during the Damages Period will be calculated by multiplying the average weekly royalty fee that you owed for the 52-week period prior to the effective date of termination by the number of weeks in the Damages Period. |
| Collection Costs and Expenses | CJR's costs and expenses | On demand, if required | These costs and expenses include, but are not limited to, costs and commissions due a collection agency, reasonable attorneys' fees, costs incurred in creating or replicating reports demonstrating Gross Sales of the Franchised Restaurant, court costs, expert witness fees, discovery costs and reasonable attorneys' fees and costs on appeal, together with interest charges on all of the foregoing. |
| Relocation | CJR's reasonable expenses | On demand, if required | You may not relocate the Franchised Restaurant without CJR's prior written consent, which may be withheld by CJR in its sole discretion. If we approve a relocation of your Franchised Restaurant, we have the right to charge you for all reasonable expenses actually incurred in connection with consideration of the request. |
| Reimbursement of Insurance Costs | Cost of obtaining coverage | Immediately upon receipt of invoice | If you fail to proc |
Source: Item 6 — Other Fees (FDD pages 28–35)
What This Means (2025 FDD)
According to the 2025 Carls Jr. Franchise Disclosure Document, the renewal fee for a franchise agreement with a renewal term of 5 years is $5,000. This fee is payable at the time the new franchise agreement is signed.
Carls Jr. retains the right to prorate the renewal fee. This would align the renewal term with a corresponding lease expiration date. This means that if the franchisee's lease on the property where the Carls Jr. restaurant is located expires before the end of the 5-year renewal term, the renewal fee may be adjusted to reflect the shorter term.
Renewal fees are common in franchising and compensate the franchisor for the administrative costs of renewing the agreement, updating training materials, and providing ongoing support. Franchisees should factor this cost into their long-term financial planning when considering renewing their Carls Jr. franchise agreement.