Under what circumstances does Hardees require a Development Fee, and how much is it per restaurant?
Hardees Franchise · 2025 FDDAnswer from 2025 FDD Document
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Other than these nine (9) actions, no litigation is required to be disclosed in this Item.
ITEM 4
BANKRUPTCY
No bankruptcy is required to be disclosed in this Item.
ITEM 5
INITIAL FEES
Development Fee
If you enter into a Development Agreement for the development of three (3) or more Franchised Restaurants to be located at Travel Center Locations or Gas and Convenience Locations, you must pay HR a Development Fee of $10,000 for each Franchised Restaurant you agree to develop at the time you sign the Development Agreement (this includes the 2025 HR Travel Center Development Incentive Program). The Development Fee is not refundable. If you execute a Franchise Agreement for a new Franchised Restaurant pursuant to the Development Agreement, the $10,000 Development Fee associated with this new Franchised Restaurant will be credited against the Initial Franchise Fee for such Franchised Restaurant. With respect to each Franchised Restaurant developed under the Development Agreem
Source: Item 5 — Initial Fees (FDD pages 27–29)
What This Means (2025 FDD)
According to Hardees's 2025 Franchise Disclosure Document, a Development Fee is required when a franchisee enters into a Development Agreement to develop three or more Hardees restaurants at Travel Center Locations or Gas and Convenience Locations. The Development Fee is $10,000 for each restaurant the franchisee agrees to develop, and this fee must be paid when the Development Agreement is signed. This includes the 2025 HR Travel Center Development Incentive Program. The Development Fee is non-refundable.
However, the FDD also states that if the franchisee later executes a Franchise Agreement for a new Hardees restaurant under the Development Agreement, the $10,000 Development Fee associated with that restaurant will be credited against the Initial Franchise Fee for that specific restaurant. The Initial Franchise Fee is $25,000, but it is reduced to $15,000 for restaurants developed under a Development Agreement. Therefore, the Development Fee essentially acts as a partial prepayment of the Initial Franchise Fee.
It's important to note that the franchisee will need to sign the Franchise Agreement form in use at the time they begin developing each restaurant, along with any applicable addenda like the 2025 HR Travel Center Development Incentive Program Addendum or 2025 DIP Addendum. This ensures that the agreement reflects the current terms and conditions at the time of development.