Does the Hardees franchise agreement confer any rights or remedies to individuals or entities other than the franchisee, HR, its affiliates, heirs, successors, and assigns?
Hardees Franchise · 2025 FDDAnswer from 2025 FDD Document
e period with any vendor or supplier to the Franchised Restaurant; and, for the 12 months before the date of Franchisee's notice and the 12 months before the expiration of the Initial Term, Franchisee shall not have been in default beyond the applicable cure period under this Agreement or any other agreements between Franchisee and HR or its affiliates.
(b) Franchisee shall make the capital expenditures required to renovate and modernize the Franchised Restaurant to conform to the interior and exterior designs, decor, color schemes, furnishings and equipment and presentation of the Proprietary Marks consistent with the image of the System for new Hardee's Restaurants at the time Franchisee provides HR the renewal notice, including such structural changes, remodeling, redecoration and modifications to existing improvements as may be necessary to do so.
(c) Franchisee and its employees at the Franchised Restaurant shall be in compliance with HR's then-current training requirements.
(d) Franchisee shall have the right to remain in possession of the Franchised Location, or other premises acceptable to HR, for the Renewal Term and all monetary obligations owed to Franchisee's landlord, if any, must be current.
(e) Franchisee, all individuals who executed this Agreement and all guarantors of Franchisee's obligations shall have executed a general release and a covenant not to sue, in a form satisfactory to HR, of any and all claims against HR and its affiliates and their respective past and present officers, directors, managers, shareholders, members, agents and employees, in their corporate and individual capacities, including, without limitation, claims arising under federal, state and local laws, rules and ordinances, and claims arising out of, or relating to, this Agreement, any other agreements between Franchisee and HR or its affiliates and Franchisee's operation of the Franchised Restaurant, other Hardee's Restaurants operated by Franchisee and all other restaurants operated by Franchisee that are franchised by HR or its affiliates.
(f) As determined by HR in its sole discretion, Franchisee has operated the Franchised Restaurant and all of its other franchised Hardee's Restaurants in accordance with the applicable franchise agreements and with the System Standards (as set forth in the OPM or otherwise and as revised from time to time by HR) and has operated each of its other restaurants that are franchised by HR or its affiliates in accordance with the applicable franchise agreement and system standards.
(3) Within 4 months after HR's receipt of Franchisee's written notice of its desire to renew, HR shall advise Franchisee whether or not Franchisee is entitled to remain a franchisee for the Renewal Term. If HR intends to permit Franchisee to remain a franchisee for the Renewal Term, HR's notice will contain preliminary information regarding actions Franchisee must take to satisfy Sections 2.B.(2)(b) and (c).
Source: Item 22 — Contracts (FDD page 85)
What This Means (2025 FDD)
According to Hardees's 2025 Franchise Disclosure Document, the franchise agreement does address rights and remedies for parties beyond the franchisee, HR (Hardees Restaurants LLC), its affiliates, heirs, successors, and assigns, particularly in the context of required releases and transfers.
Specifically, when a franchisee seeks to renew their agreement, they, along with all individuals who executed the agreement and any guarantors, must execute a general release and covenant not to sue Hardees. This release covers any claims against Hardees and its affiliates, including their officers, directors, managers, shareholders, members, agents, and employees. The release extends to claims arising under federal, state, and local laws, as well as those related to the franchise agreement itself and the operation of the Hardees restaurant. This indicates that individuals and entities beyond the immediate parties to the agreement (such as guarantors and employees) are subject to certain requirements and conditions that affect their rights.
Additionally, if a franchisee intends to transfer their interest in the franchise, the proposed transferee must submit a franchise application and other information to Hardees. Hardees then has the sole discretion to approve or deny the transfer based on various factors, including the transferee's experience and financial capacity. This process ensures that any new party assuming control of the franchise meets Hardees's standards and qualifications, thereby affecting the rights and obligations of potential transferees.
Finally, in the event that Hardees chooses to use a different principal name to identify System Restaurants, Hardees may direct the franchisee to change all or some items bearing the Proprietary Marks to the new name. This change can be made without any liability to the franchisee, provided that Hardees has committed to adopting that name and making the necessary changes in at least 60% of the System Restaurants operated by HR or HR Affiliates (if the change affects all System Restaurants) or, in all other circumstances, in at least 60% of the System Restaurants operated by HR or HR Affiliates in the DMA in which the Franchised Restaurant is located. This demonstrates that Hardees retains the right to make changes that affect the brand and image of the franchise, even if it impacts the franchisee's operations.