For Hardees, how long after the expiration, transfer, or termination of the Franchise Agreement do the restrictions in Section 20 apply to guarantors?

According to Hardees's 2025 Franchise Disclosure Document, the restrictions outlined in Section 20 of the Franchise Agreement apply to both the franchisee and any guarantors of the franchisee's obligations. For guarantors, these restrictions are in effect for a period of 2 years. This 2-year period begins after the earlier of two events: either the expiration, transfer, or termination of the Franchise Agreement, or the date the guarantor ceases to be the Operating Principal, a stockholder, a member of the Continuity Group, or a 10% Owner. If the guarantor is the spouse of someone holding one of these positions, the 2-year restriction begins when that person ceases to hold the position.

This means that if you act as a guarantor for a Hardees franchise, you will be bound by certain restrictions for up to two years after the franchise agreement ends or after you relinquish certain controlling interests in the franchise. These restrictions are designed to protect Hardees's business interests and prevent unfair competition. The restrictions do not apply if the guarantor has less than 5% ownership in a publicly held corporation.

It is important for prospective Hardees franchisees and their guarantors to carefully review Section 20 of the Franchise Agreement to fully understand the specific restrictions that apply. These restrictions may limit your ability to engage in certain business activities, particularly those that could be seen as competitive to Hardees, within a specified timeframe and geographic area. Understanding these obligations is crucial before signing the Franchise Agreement and agreeing to act as a guarantor.