Does the Buns On Fire franchisor have the right to approve all transfers of the franchise by the franchisee?
Buns_On_Fire Franchise · 2025 FDDAnswer from 2025 FDD Document
| k. "Transfer" by franchisee— defined | XX | Includes transfer of contract, of assets or any ownership change. |
|---|---|---|
| 1. Franchisor approval of | XX | We have the right to approval all transfers. |
| transfer by franchisee | ||
| m. Conditions for franchisor approval of transfer | XX | Transferee qualifies, all amounts due are paid in full, you sign a general release in our favor, transferee completes training, transfer fee paid, then-current contract signed |
| n. Franchisor's right of first refusal | XX | We can match any offer. |
| to acquire franchisee's business | ||
| o. Franchisor's option to purchase | XX | We can buy the business on termination or |
| franchisee's business | non-renewal for the price offered to you. |
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 retains the right to approve all franchise transfers initiated by the franchisee. This is a common practice in franchising, as it allows the franchisor to maintain control over who operates under their brand name and ensures that new franchisees meet their standards.
Specifically, the FDD outlines several conditions that must be met for the franchisor to approve a transfer. These include ensuring the transferee (the person or entity buying the franchise) meets the franchisor's qualifications, all outstanding payments to Buns On Fire are settled, the franchisee signs a general release in favor of Buns On Fire, the transferee completes the required training program, a transfer fee is paid, and the transferee signs the then-current franchise agreement.
Furthermore, Buns On Fire also has the right of first refusal, meaning they can match any offer made by a potential buyer and acquire the franchisee's business themselves. They also have the option to purchase the business upon termination or non-renewal of the franchise agreement for the price offered to the franchisee. These provisions give Buns On Fire significant control over the transfer process and the future of the franchise location.