What constitutes a failure to meet the development schedule that would put a Hardees developer in default?
Hardees Franchise · 2025 FDDAnswer from 2025 FDD Document
e's Restaurants in the Development Territory; (E) merchandise and distribute products identified by some or all of the Proprietary Marks in the Development Territory through any other method or channel of distribution; and (F) sell and distribute products identified by some or all of the Proprietary Marks in the Development Territory to restaurants other than Hardee's Restaurants, provided those restaurants are not licensed to use the Proprietary Marks in connection with their retail sales.
Except as reserved in the preceding paragraph, HR will not, during the Development Term, operate or license others to operate Hardee's Restaurants in the Development Territory, provided Developer is in compliance with the terms of this Agreement and any other agreements with HR or its affiliates and is current on all obligations due HR and its affiliates. This Section 2 does not prohibit HR or its affiliates from: (1) operating and licensing others to operate, during the Development Term, Hardee's Restaurants at any location outside of the Development Territory; (2) operating and licensing others to operate, after this Agreement terminates or expires, Hardee's Restaurants at any location, including in the Development
Territory; and (3) operating and licensing others to operate at any location, during or after the Development Term, any type of restaurant other than a Hardee's Restaurant.
The restrictions contained in this Section 2 apply only to HR and do not apply to Hardee's Restaurants under development or in operation in the Development Territory as of the date of this Agreement. Nothing shall prohibit HR or its affiliates from operating or licensing a restaurant at any location in or outside the Development Territory, other than a restaurant in the Development Territory that primarily is identified by the name and mark "Hardee's."
3. DEVELOPMENT SCHEDULE
- A. During the Development
Source: Item 23 — Receipts (FDD pages 85–541)
What This Means (2025 FDD)
According to Hardees's 2025 Franchise Disclosure Document, strict adherence to the development schedule is crucial. A developer's failure to meet the obligations for opening restaurants as per the development schedule, or failing to secure site acceptance by the specified date, constitutes a significant breach of the agreement. This breach allows Hardees to immediately terminate the agreement with written notice.
Furthermore, if Hardees requests a development plan and the developer fails to comply with it or any significant aspect of it, this also constitutes a material breach, leading to immediate termination by Hardees with written notice. The initial franchise fee for each restaurant developed under the agreement is $25,000, and even if a restaurant is sold during the development term, it still counts towards the developer's obligations, provided Hardees consents to the sale and the restaurant continues to operate under a franchise agreement with Hardees or its affiliates.
These stipulations highlight the importance of meeting development targets and complying with any development plans set forth by Hardees. A prospective Hardees developer should carefully review the development schedule and plan, understanding the timelines and obligations, as failure to comply can result in immediate termination of the development agreement.