Bank Tells Karcher to Repay Loan or Face Sale of Stock : Debt: The Carl’s Jr. founder pledged almost a million shares, 10% of his stake, to secure a $4.8-million loan.

Commercial Center Bank in Santa Ana, which lent $4.8 million to Carl N. Karcher, intends to sell stock he pledged to back the loan unless Karcher repays it all today, according to a filing Karcher made with the Securities and Exchange Commission.

The stock represents about 10% of Karcher’s stake in the parent of the Carl’s Jr. fast-food chain, which ousted him as chairman last Friday.

Sale of the stock would leave Karcher with less than 31% of Carl Karcher Enterprises Inc.’s shares and would hurt the price per share if the stock were dumped quickly, analysts said.

In Nasdaq trading Thursday, Karcher shares closed at $8, off 12.5 cents.

And if the bank goes through with its plan to sell the shares--diluting Karcher’s voting power--it would be tougher for Karcher to wage his threatened proxy fight to regain control of the company, which he founded in 1941.

According to the SEC filing, the bank could sell the stock as early as Tuesday.

Andrew F. Puzder, Karcher’s lawyer, pointed out that more stock is pledged to the banks than would be needed to pay off the debts.

Commercial Center, for instance, would have to sell about 600,000 shares at Thursday’s closing price of $8 a share to satisfy the debt.

“We’re not particularly worried” about the demand for payment, Puzder said. “We think we’ll be able to deal with the situation.”

Karcher was ousted in a dispute over marketing strategies to boost flagging sales and to improve profit and the share price at the fast-food chain.

Karcher has been trying to persuade the company’s directors to test his idea of selling Green Burrito Mexican-style food alongside hamburgers, chicken sandwiches and salads at some of the 648 Carl’s Jr. outlets.

But the board rejected his idea and instead backed company President Donald E. Doyle Jr.’s program for offering items at lower prices.

The loan from Commercial Center is one of two personal loans on which Karcher is in default. He pledged 998,700 shares for the Commercial Center loan two years ago.

At the same time, he pledged 3.56 million shares for a Union Bank loan that, with unpaid interest, now amounts to $25.1 million. The proceeds were invested in real estate projects that since have gone sour, leaving Karcher in precarious financial straits.

A total of 73% of Karcher’s stock is backing the two loans.

A spokesman for Karcher Enterprises would not comment on the founder’s SEC filing, and executives at the two banks would not comment on the status of the loans.

Times staff writers Susan Christian, Greg Johnson and Chris Woodyard contributed to this report.