Can Hardees be held liable to the franchisee or proposed transferee if Hardees withholds consent to the transfer?

According to Hardees's 2025 Franchise Disclosure Document, Hardees's decision regarding a proposed transfer does not create any liability on its part to the franchisee or the proposed transferee if Hardees withholds consent. This means that a franchisee cannot sue Hardees if they deny a transfer request, regardless of the reason. Similarly, the potential buyer also has no legal recourse against Hardees in such a situation.

This provision protects Hardees from potential legal challenges related to transfer decisions. Hardees retains sole discretion in approving or denying transfers, based on factors they deem relevant. These factors include the transferee's experience, financial resources, and compatibility with Hardees's management culture.

This lack of liability underscores the importance of understanding Hardees's transfer requirements before entering into a franchise agreement. A franchisee should carefully consider the criteria Hardees uses to evaluate potential transferees and the potential implications if a transfer is denied. This clause is fairly standard in franchise agreements, as franchisors want to retain control over who enters their system.