What obligations of the Hardees Franchisee are guaranteed by the Guarantors to Hardee's Restaurants LLC?
Hardees Franchise · 2025 FDDAnswer from 2025 FDD Document
| In consideration of, and as an inducement to, the execution of the Hardee's Restaurant Franchise |
|---|
| Agreement dated as of ("Agreement") by Hardee's Restaurants |
| LLC ("HR"), entered into with ("Franchisee"), |
| the undersigned ("Guarantors"), each of whom is a member of Franchisee's Continuity Group or a 10% |
| Owner, or the spouse thereof, hereby personally and unconditionally agree as follows: |
Source: Item 22 — Contracts (FDD page 85)
What This Means (2025 FDD)
According to Hardees's 2025 Franchise Disclosure Document, the Guarantors, who are either members of the Franchisee's Continuity Group, a 10% Owner, or their spouse, personally and unconditionally agree to guarantee the obligations of the Franchisee to Hardee's Restaurants LLC under the Hardee's Restaurant Franchise Agreement.
This means that if the franchisee fails to meet their financial or operational obligations as outlined in the franchise agreement, Hardees can seek recourse from the Guarantors. This guarantee provides Hardees with an added layer of security, ensuring that there are individuals who are financially responsible for the franchisee's performance.
For a prospective Hardees franchisee, this implies that certain individuals associated with their ownership structure (Continuity Group members, significant owners, or their spouses) must be willing to personally guarantee the franchisee's obligations. This is a common practice in franchising, as it mitigates the risk for the franchisor and ensures that the franchisee has a strong commitment to the business. Franchisees should carefully consider the implications of this requirement and ensure that the Guarantors understand their responsibilities.