Under the Hardees Development Agreement, which sections outline territorial development and sales quotas?
Hardees Franchise · 2025 FDDAnswer from 2025 FDD Document
Except as reserved in the preceding paragraph, HR will not, during the Development Term, operate or license others to operate Hardee's Restaurants in the Development Territory, provided Developer is in compliance with the terms of this Agreement and any other agreements with HR or its affiliates and is current on all obligations due HR and its affiliates. This Section 2 does not prohibit HR or its affiliates from: (1) operating and licensing others to operate, during the Development Term, Hardee's Restaurants at any location outside of the Development Territory; (2) operating and licensing others to operate, after this Agreement terminates or expires, Hardee's Restaurants at any location, including in the Development
Territory; and (3) operating and licensing others to operate at any location, during or after the Development Term, any type of restaurant other than a Hardee's Restaurant.
3. DEVELOPMENT SCHEDULE
- A. During the Development Term, Developer shall develop, open and continuously operate in the Development Territory the number of Franchised Restaurants specified in the Development Schedule in attached Appendix B.
Strict compliance with the Development Schedule is essential to this Agreement.
You will not receive an exclusive territory under the Development Agreement. You may face competition from other franchisees, from outlets that we own, or from other channels of distribution or competitive brands that we control.
There are no restrictions on the areas in which you may advertise or solicit customers for your Franchised Restaurants; however, see Item 13 for internet restrictions. We reserve all rights to use and license the Hardee's System, and the Proprietary Marks other than those that we expressly grant you. There are no restrictions on the areas in which we may advertise or solicit customers, nor must we compensate you for soliciting or accepting orders from inside the Development Territory. The rights we reserve include the right to use any other channel of distribution, including the internet, to make sales in the Development Territory using the Proprietary Marks or different proprietary marks.
Source: Item 9 — Franchisee's Obligations (FDD pages 42–43)
What This Means (2025 FDD)
According to Hardees's 2025 Franchise Disclosure Document, the Development Schedule in Appendix B outlines the number of franchised restaurants a developer must open and operate within the Development Territory during the Development Term. Strict compliance with this schedule is essential to the Development Agreement.
Section 2 of Item 23 states that Hardees will not operate or license others to operate Hardee's Restaurants in the Development Territory as long as the Developer complies with the terms of the agreement and is current on all obligations. However, this restriction does not prevent Hardees from operating or licensing restaurants outside the Development Territory, after the agreement terminates, or any other type of restaurant.
Item 12 states that under the Development Agreement, franchisees do not receive an exclusive territory and may face competition from other franchisees, outlets owned by Hardees, or other channels. There are no restrictions on advertising areas, but Item 13 addresses internet restrictions. Hardees retains the right to use and license the Hardee's System and Proprietary Marks, and can solicit customers from within the Development Territory without compensation to the franchisee.