How does the Hardees advertising obligation in Item 6 compare to the advertising assistance provided by the franchisor in Item 11?

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of its existing Franchised Restaurants. In 2025 we waived the Initial Franchise Fee in certain instances where a new franchisee was taking over operation of a Franchised Restaurant that was closed or otherwise may have closed.

**ITEM 6 OTHER FEES**

| Type of Fee (1) | Amount | Due Date | Remarks |
|---|---|---|---|
|  |  | upon receipt of invoice |  |
| Hardee’s Advertising | An advertising and promotional obligation (“APO”) in an amount set forth in your Franchise Agreement. Your APO will be up to 7% of Hardee’s Gross Sales. Currently, your APO is 5.5% of Hardee’s Gross Sales. (3) |  | Divided between HNAF, Regional Co-op and LSM (each as defined below) |
| Hardee’s National Advertising Fund (“HNAF”) | Currently, 4.25% of Hardee’s Gross Sales | On the 10th day of each month | HNAF contributions are due on the 10th day of each month and are based on Gross Sales in the prior month. |
| Hardee’s Regional Cooperative (“Regional Co-op”) | If your Franchised Restaurant is in an area covered by a Regional Co-op, currently, minimum of 0.5% of Hardee’s Gross Sales; however, your Regional Co- op can vote to increase each member’s contribution. | Same as royalty | We have the right, in our sole discretion, to establish a regional advertising and sales promotion cooperative in the regional area in which your Franchised Restaurant is located (“DMA”) to which you will be required to contribute. |
| Hardee’s Local Store Marketing (“LSM”) | Difference between your APO and the amount you contribute to HNAF and a Regional Co-op | Not paid to HR | You may develop advertising materials for your own use; however, we must approve these advertising materials in advance of use. LSM monies may be spent only for approved advertising. (4) |
| Interest | Interest on the amount owed from the date due until paid | When any payment is overdue | The interest rate is the maximum rate permitted for indebtedness of this nature in the state in which the Franchised Restaurant is located not to exceed 1.5% per fiscal period (or a portion of a fiscal period). |
| Secret Shopper, and other Quality Assurance (QA) Programs | All costs associated with the Secret Shopper programs or other QA programs as HR may require | As incurred | You must participate in programs initiated to verify customer satisfaction and/or your compliance with all operational and other aspects of the System. Currently, there is no charge for an initial QA audit; the cost of a second audit due to a deficiency is currently $211 per Restaurant which may be increased every year, although we do not anticipate the annual increase to exceed 30%. |
| Non-Cash Payment Systems | All costs associated with non- cash payment systems | As incurred | You must accept debit cards, credit cards, stored value gift cards or other non-cash payment systems specified by HR to enable customers to purchase authorized products. |
| Other Training | Fees are based upon, but not limited to, actual materials, vendor charges and facility costs and likely will range from $300 to $1,000.

How does the Hardees advertising obligation in Item 6 compare to the advertising assistance provided by the franchisor in Item 11?

Answer from 2025 FDD Document

What This Means (2025 FDD)

Type of Fee (1)	Amount	Due Date	Remarks
		upon receipt of invoice
Hardee’s Advertising	An advertising and promotional obligation (“APO”) in an amount set forth in your Franchise Agreement. Your APO will be up to 7% of Hardee’s Gross Sales. Currently, your APO is 5.5% of Hardee’s Gross Sales. (3)		Divided between HNAF, Regional Co-op and LSM (each as defined below)
Hardee’s National Advertising Fund (“HNAF”)	Currently, 4.25% of Hardee’s Gross Sales	On the 10th day of each month	HNAF contributions are due on the 10th day of each month and are based on Gross Sales in the prior month.
Hardee’s Regional Cooperative (“Regional Co-op”)	If your Franchised Restaurant is in an area covered by a Regional Co-op, currently, minimum of 0.5% of Hardee’s Gross Sales; however, your Regional Co- op can vote to increase each member’s contribution.	Same as royalty	We have the right, in our sole discretion, to establish a regional advertising and sales promotion cooperative in the regional area in which your Franchised Restaurant is located (“DMA”) to which you will be required to contribute.
Hardee’s Local Store Marketing (“LSM”)	Difference between your APO and the amount you contribute to HNAF and a Regional Co-op	Not paid to HR	You may develop advertising materials for your own use; however, we must approve these advertising materials in advance of use. LSM monies may be spent only for approved advertising. (4)
Interest	Interest on the amount owed from the date due until paid	When any payment is overdue	The interest rate is the maximum rate permitted for indebtedness of this nature in the state in which the Franchised Restaurant is located not to exceed 1.5% per fiscal period (or a portion of a fiscal period).
Secret Shopper, and other Quality Assurance (QA) Programs	All costs associated with the Secret Shopper programs or other QA programs as HR may require	As incurred	You must participate in programs initiated to verify customer satisfaction and/or your compliance with all operational and other aspects of the System. Currently, there is no charge for an initial QA audit; the cost of a second audit due to a deficiency is currently $211 per Restaurant which may be increased every year, although we do not anticipate the annual increase to exceed 30%.
Non-Cash Payment Systems	All costs associated with non- cash payment systems	As incurred	You must accept debit cards, credit cards, stored value gift cards or other non-cash payment systems specified by HR to enable customers to purchase authorized products.
Other Training	Fees are based upon, but not limited to, actual materials, vendor charges and facility costs and likely will range from $300 to $1,000.