Under what conditions are capital expenses for the repair and maintenance of the Hardees Franchised Location not subject to the time limitations for modernization?
Hardees Franchise · 2025 FDDAnswer from 2025 FDD Document
- C. Extensive structural changes, major remodeling and renovations, and substantial modifications to existing equipment and improvements to modernize and conform the Franchised Restaurant to the image of the System for new franchised and company restaurants shall be required: (i) as a condition of renewal, (ii) as a condition of HR issuing its consent to a proposed transfer as defined further in Section 18 below, or (iii) at HR's request (but not more often than every 5 years). Capital expenses necessary for the repair and maintenance of the Franchised Location and modifications required by applicable law or required to abate a hazardous situation are not subject to the time limitations described in the preceding sentence. Within 60 days after receipt of HR's written notice regarding the required modernization, Franchisee shall prepare and complete drawings and plans, along with a project timeline, for the required modernization. These drawings and plans must be submitted to, and their use approved by, HR prior to the commencement of work. Franchisee shall complete the required modernization within the time reasonably specified by HR in its written notice.
Source: Item 22 — Contracts (FDD page 85)
What This Means (2025 FDD)
According to Hardees's 2025 Franchise Disclosure Document, capital expenses for the repair and maintenance of the franchised location are not subject to the standard time limitations for modernization under specific conditions. These exceptions apply to expenses necessary for the general upkeep and repair of the location, as well as modifications mandated by law or required to address hazardous situations.
In practical terms, this means that if a Hardees franchisee needs to make repairs to the building, equipment, or premises to keep the restaurant in good working order, those expenses do not fall under the typical modernization schedule. Similarly, if local, state, or federal laws require specific modifications to the property, or if a hazardous condition needs to be abated, the franchisee can address these issues without being bound by the usual modernization timelines.
This provision offers Hardees franchisees some flexibility in managing their restaurant's upkeep and addressing urgent or legally required changes. It prevents franchisees from being penalized or delayed by the standard modernization schedule when dealing with necessary repairs or legally mandated modifications. However, franchisees should maintain thorough records of such expenses and ensure they comply with Hardees's standards and any applicable laws to avoid potential disputes.