Under what circumstances will the Hardees agreement automatically terminate if the franchise agreement between the Customer and Operator is terminated?

According to Hardees's 2025 Franchise Disclosure Document, the agreement between Hardees and a franchisee will automatically terminate under specific conditions related to the franchise agreement between a Customer and an Operator. Specifically, if the franchise agreement between the Customer and the Operator is terminated, the agreement with Hardees will automatically terminate for all of the Customer's franchised locations operated by that Operator.

This means that if a franchisee (Customer) uses an Operator to run their Hardees locations, and the agreement with that Operator is terminated, all Hardees franchises under that Customer and Operator will have their agreements terminated. This could have significant implications for franchisees who rely on Operators to manage multiple locations, as the termination of the Operator agreement would lead to the automatic termination of all related Hardees franchise agreements.

Additionally, the Hardees agreement will automatically terminate for a specific franchised location if the Operator no longer owns and operates that location. In this case, the termination only applies to the specific location that is no longer owned or operated by the Operator, not all locations under the Customer. This distinction is important for franchisees to understand, as it clarifies the scope of the termination based on the Operator's involvement with the franchise locations.