What action must a Hardees developer take upon receiving written notice of a modification to a covenant in Section 12?
Hardees Franchise · 2025 FDDAnswer from 2025 FDD Document
HR shall have the right, in its sole discretion, to reduce the scope of any covenant in this Section 12 effective immediately upon Developer's receipt of written notice, and Developer agrees that it shall comply forthwith with any covenant as so modified, which shall be fully enforceable notwithstanding the provisions of Section 20.
Source: Item 23 — Receipts (FDD pages 85–541)
What This Means (2025 FDD)
According to Hardees's 2025 Franchise Disclosure Document, if Hardees reduces the scope of any covenant in Section 12, the developer must comply with the modified covenant immediately upon receiving written notice. This compliance is required regardless of the provisions outlined in Section 20 of the agreement.
This means that Hardees has the right to change the restrictions placed on the developer as outlined in Section 12, and the developer is obligated to adhere to these changes as soon as they are notified in writing. This could impact the developer's business operations, potentially limiting or expanding their activities based on Hardees's decisions.
Prospective Hardees developers should carefully review Section 12 of the franchise agreement to understand the full scope of these covenants and the potential for modifications. They should also consider the implications of being required to comply with changes immediately upon notification, as this could require quick adjustments to their business practices.