Under what conditions can Hardees terminate the Development Agreement due to a franchisee's default?
Hardees Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in Development Agreement | Summary |
|---|---|---|
| f. Termination by us with cause | Section 13 | We may terminate upon default, which includes, but is not limited to, remaining in default beyond any applicable cure period under any agreement with us or our affiliates, including the Franchise Agreement. |
| g. “Cause” defined-curable defaults | Section 13.A.(13) | You have 10 days to cure monetary defaults. You have 30 days to cure defaults other than those discussed in paragraph h. |
| h. “Cause” defined-non-curable defaults | Sections 13.A.(1)-(12) | Non-curable defaults include: failure to obtain written site acceptance on schedule; failure to open and operate the scheduled number of Franchised Restaurants; begin construction before receipt of fully-signed Franchise Agreement; insolvency; bankruptcy; material breach of covenants; transfer without our prior written consent; material misrepresentation; falsification of reports; felony convictions; default beyond cure period under other agreements with HR or its affiliates, under any real estate or |
Source: Item 17 — Renewal, Termination, Transfer, and Dispute Resolution (FDD pages 64–69)
What This Means (2025 FDD)
According to Hardees's 2025 Franchise Disclosure Document, Hardees can terminate the Development Agreement with a franchisee upon default. This includes remaining in default beyond any applicable cure period under any agreement with Hardees or its affiliates, including the Franchise Agreement.
Curable defaults allow the franchisee a period to rectify the issue. Hardees provides a 10-day cure period for monetary defaults, meaning failure to pay fees or other financial obligations. For other types of defaults, the franchisee has 30 days to correct the issue, except for non-curable defaults.
Non-curable defaults, which cannot be rectified with a cure period, include specific failures related to the development schedule, such as failing to obtain written site acceptance on schedule or failing to open and operate the scheduled number of Hardees restaurants. Additional non-curable defaults include beginning construction before receiving a fully-signed Franchise Agreement, insolvency, bankruptcy, material breach of covenants, unauthorized transfer of the agreement, material misrepresentation, falsification of reports, felony convictions, and defaulting beyond the cure period under other agreements with Hardees or its affiliates, including real estate or financing agreements.