When does HR have the option to take an assignment of a Hardees tenant's rights and obligations under the lease?
Hardees Franchise · 2025 FDDAnswer from 2025 FDD Document
Landlord and Tenant acknowledge that HR's exercise of the foregoing rights is subject to Tenant's right to exercise such rights, and that if Tenant legally exercises such right within the time permitted under the Lease, HR's exercise of such rights, whether before or after Tenant's exercise, shall be void.
11. HR is hereby deemed a third party beneficiary of this Addendum solely for the purpose of enforcing any rights granted to or otherwise available to HR under this Addendum.
12. Upon the expiration or termination of the Lease or Franchise Agreement, Landlord acknowledges and agrees that HR has the option, in accordance with its rights under the Franchise Agreement, to take an assignment of Tenant's rights and obligations under the Lease.
HR may exercise its step-in rights by giving written notice to the Landlord at any time following such expiration or termination of the Lease or Franchise Agreement up until 30 days after the later of: (1) the effective date of termination or expiration of the Lease or Franchise Agreement; or (2) the date Tenant ceases to operate the Restaurant
Source: Item 23 — Receipts (FDD pages 85–541)
What This Means (2025 FDD)
According to the 2025 Hardees Franchise Disclosure Document, HR (Hardee's Restaurants LLC or its affiliates) has the option to take an assignment of a tenant's rights and obligations under the lease upon the expiration or termination of the Lease or Franchise Agreement.
HR can exercise these rights by providing written notice to the Landlord. This notice must be given at any time following the expiration or termination of the Lease or Franchise Agreement, up until 30 days after the later of two possible dates: either the effective date of termination or expiration of the Lease or Franchise Agreement, or the date the tenant ceases to operate the Hardees Restaurant.
This addendum ensures that Hardees has a mechanism to maintain control over the restaurant location even if the franchisee's lease or franchise agreement ends, allowing for continued operation of a Hardees restaurant at that location. This is a common practice in franchising, as it protects the brand's presence and customer base.