What happens if the sales price of a Hardees franchise is too high, in HR's judgment?
Hardees Franchise · 2025 FDDAnswer from 2025 FDD Document
- (2) If the Transfer is a sale, the sales price shall not be so high, in HR's reasonable judgment, as to jeopardize the ability of the transferee to develop, maintain, operate, remodel, re-image, refresh and promote the Franchised Restaurant and meet financial obligations to HR, third party suppliers and creditors.
HR's decision with respect to a proposed Transfer shall not create any liability on the part of HR: (a) to the transferee, if HR consents to the Transfer and the transferee experiences financial difficulties; or (b) to Franchisee or the proposed transferee, if HR withholds consent to the Transfer.
HR, without any liability to Franchisee or the proposed transferee, has the right, in its sole discretion, to communicate and counsel with Franchisee and the proposed transferee regarding any aspect of the proposed Transfer.
Source: Item 22 — Contracts (FDD page 85)
What This Means (2025 FDD)
According to Hardees's 2025 Franchise Disclosure Document, if a franchisee seeks to transfer their franchise through a sale, Hardees evaluates the proposed sales price. Specifically, Hardees must deem that the sales price is not so high that it would jeopardize the ability of the new franchisee to successfully manage and operate the Hardees restaurant. This includes the transferee's ability to develop, maintain, operate, remodel, re-image, refresh, and promote the restaurant, as well as meet their financial obligations to Hardees, third-party suppliers, and creditors.
Hardees's judgment on the sales price is based on whether the new franchisee can realistically handle the financial demands of the business after paying the agreed-upon price for the franchise. This evaluation aims to protect the Hardees brand and ensure the continued success of the franchise location under new ownership.
Hardees's decision regarding the transfer, including the sales price, does not create any liability for Hardees. Hardees is not liable to the transferee if they experience financial difficulties after the transfer, even if Hardees consented to the transfer. Similarly, Hardees is not liable to the original franchisee or the proposed transferee if it withholds consent for the transfer. Hardees retains the right to communicate and counsel both the franchisee and the proposed transferee regarding any aspect of the proposed transfer without incurring any liability.