If the Hardees franchisee is an individual, are they personally liable for breaches of the Franchise Agreement?
Hardees Franchise · 2025 FDDAnswer from 2025 FDD Document
If Franchisee is an individual, or a partnership comprised solely of individuals, Franchisee makes the following additional representations and warranties: (A) each individual has executed this Agreement; (B) each individual shall be jointly and severally bound by, and personally liable for the timely and complete performance and a breach of, each and every provision of this Agreement; and
(C) notwithstanding any transfer for convenience of ownership, pursuant to Section 18.D., each individual shall continue to be jointly and severally bound by, and personally liable for the timely and complete performance and a breach of, each and every provision of this Agreement.
Source: Item 22 — Contracts (FDD page 85)
What This Means (2025 FDD)
According to Hardees' 2025 Franchise Disclosure Document, if the franchisee is an individual or a partnership comprised solely of individuals, each individual is jointly and severally bound by, and personally liable for, the timely and complete performance and any breach of every provision within the Franchise Agreement. This means that each individual franchisee is fully responsible for upholding the terms of the agreement.
This personal liability extends to all aspects of the Franchise Agreement, ensuring that Hardees can seek recourse directly from the individual's personal assets if the franchise fails to meet its obligations. This provision remains in effect even if there is a transfer of ownership for convenience, as each individual remains liable for the performance and any breaches of the agreement.
For a prospective Hardees franchisee, this clause underscores the importance of understanding the full scope of the Franchise Agreement and the potential financial risks involved. It is advisable to seek legal counsel to fully comprehend the implications of personal liability before entering into the agreement. This is a common practice in franchising, as franchisors often seek to ensure that franchisees are fully committed to the business and its obligations.