Does the Buns On Fire franchisor have any restrictions on assigning the franchise contract?
Buns_On_Fire Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Article in the Franchise Agreement | Summary |
|---|---|---|
| a. Length of the franchise term | IV | 10 years. |
| b. Renewal or extension | IV | One additional term of 10 years. You have been in substantial compliance with agreement. You pay the renewal fee. You may have to remodel your location, at your expense. |
| c. Requirement for franchisee to renew or extend | IV | You may be asked to sign a contract with materially different terms and conditions than your original contract, pay the renewal fee, comply with any new training requirements and serve notice of intention to renew not less than twelve (12) months nor more than eighteen (18) months prior to the expiration of the agreement. You may be required to sign a general release in favor of us. |
| d. Termination by franchisee | None. | The Franchise Agreement does not provide for this. But you may seek to terminate on any grounds available to you at law. |
| e. Termination by franchisor | Not Applicable | Not Applicable |
| without cause | ||
| f. Termination by franchisor with | XVII | We can terminate only if you commit any one |
| cause | of several listed violations | |
| g. "Cause" defined—curable defaults | XVII | 30 days for operations defaults, 30 days for monetary defaults, 24 hours for health code violations, as set forth in the Franchise Agreement |
| h. "Cause" defined—non- curable defaults | XVII | Conviction of a felony, abandonment, unapproved transfers, bankruptcy, assignment for benefit of creditors, repeated violations; termination for cause of another contract between us and you. |
| i. Franchisee's obligations on termination/non-renewal | XVIII | Pay outstanding amounts, de-identification, return of confidential information and other materials provided by us; pay liquidated damages. |
| j. Assignment of contract by | XX | No restriction on our right to assign. |
| franchisor |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION THE FRANCHISE RELATIONSHIP (FDD pages 41–43)
What This Means (2025 FDD)
According to Buns On Fire's 2025 Franchise Disclosure Document, the franchisor faces no restrictions on assigning the franchise agreement. This means Buns On Fire has the freedom to transfer its rights and obligations under the franchise agreement to another party without needing the franchisee's consent or meeting specific conditions. This is a standard clause in most franchise agreements, allowing the franchisor flexibility in corporate restructuring, mergers, acquisitions, or other business transactions.
For a prospective Buns On Fire franchisee, this lack of restriction on the franchisor's ability to assign the contract means that the franchisee could find themselves dealing with a completely different entity during the term of their franchise agreement. While the terms of the agreement should remain the same, the new franchisor might have a different management style, vision, or approach to supporting franchisees. This could potentially impact the franchisee's business operations and relationship with the franchisor.
Conversely, the FDD outlines several conditions and restrictions on the franchisee's ability to transfer their franchise. The franchisee needs franchisor approval for all transfers, and the franchisor has the right of first refusal to acquire the franchisee's business. The franchisor can also buy the business upon termination or non-renewal for the price offered to the franchisee. These provisions ensure that Buns On Fire maintains control over who operates its franchises and protects its brand standards. Franchisees must also ensure the transferee qualifies, all outstanding amounts are paid, a general release is signed, the transferee completes training, a transfer fee is paid, and the then-current contract is signed.