When is interest charged on overdue payments to Hardee's?
Hardees Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Fee (1) | Amount | Due Date | Remarks |
|---|---|---|---|
| upon receipt of invoice | |||
| Hardee’s Advertising | An advertising and promotional obligation (“APO”) in an amount set forth in your Franchise Agreement. Your APO will be up to 7% of Hardee’s Gross Sales. Currently, your APO is 5.5% of Hardee’s Gross Sales. (3) | Divided between HNAF, Regional Co-op and LSM (each as defined below) | |
| Hardee’s National Advertising Fund (“HNAF”) | Currently, 4.25% of Hardee’s Gross Sales | On the 10th day of each month | HNAF contributions are due on the 10th day of each month and are based on Gross Sales in the prior month. |
| Hardee’s Regional Cooperative (“Regional Co-op”) | If your Franchised Restaurant is in an area covered by a Regional Co-op, currently, minimum of 0.5% of Hardee’s Gross Sales; however, your Regional Co- op can vote to increase each member’s contribution. | Same as royalty | We have the right, in our sole discretion, to establish a regional advertising and sales promotion cooperative in the regional area in which your Franchised Restaurant is located (“DMA”) to which you will be required to contribute. |
| Hardee’s Local Store Marketing (“LSM”) | Difference between your APO and the amount you contribute to HNAF and a Regional Co-op | Not paid to HR | You may develop advertising materials for your own use; however, we must approve these advertising materials in advance of use. LSM monies may be spent only for approved advertising. (4) |
| Interest | Interest on the amount owed from the date due until paid | When any payment is overdue | The interest rate is the maximum rate permitted for indebtedness of this nature in the state in which the Franchised Restaurant is located not to exceed 1.5% per fiscal period (or a portion of a fiscal period). |
Source: Item 6 — OTHER FEES (FDD pages 29–36)
What This Means (2025 FDD)
According to Hardee's 2025 Franchise Disclosure Document, interest is charged on any overdue payment from the date the payment was due until it is paid. The interest rate applied will be the maximum rate permitted for this type of debt in the state where the Hardee's restaurant is located. However, this rate cannot exceed 1.5% per fiscal period, or a portion of a fiscal period.
This means that if a Hardee's franchisee fails to make a payment on time, they will incur interest charges on the outstanding balance. The specific interest rate will depend on state law, but Hardee's has capped it at 1.5% per fiscal period. Fiscal periods are typically a calendar quarter, but the franchisee should confirm this with Hardee's.
For a prospective Hardee's franchisee, this highlights the importance of making all payments on time to avoid accumulating interest charges. It's also important to understand the maximum interest rate that could be applied in the state where the restaurant will operate. Franchisees should budget accordingly to ensure timely payments and maintain a good financial standing with Hardee's.