Under the Buns On Fire Guaranty, what is the effect of the cessation of liability of the franchisee?

According to the 2025 FDD, Buns On Fire outlines the franchisor's right to transfer the agreement. Specifically, Buns On Fire states that it can assign, transfer, or sell its rights under the Franchise Agreement without the franchisee's consent. This is permissible as long as the transferee agrees in writing to assume all of Buns On Fire's obligations and the franchisee receives a statement from both Buns On Fire and its transferee confirming this agreement.

Upon such assignment and assumption of the agreement, Buns On Fire states that it will have no further obligation under the agreement, except for any accrued liabilities. This means that once the transfer is complete and the new entity takes over, Buns On Fire is released from most future responsibilities and liabilities related to the franchise agreement.

For a prospective franchisee, this clause means that the original Buns On Fire franchisor can essentially step away from the agreement, transferring all responsibilities and benefits to another party. While this provides flexibility for Buns On Fire, it also introduces uncertainty for the franchisee, as the new entity's management style, resources, and commitment to the franchise system could differ from the original franchisor. The franchisee should ensure that the agreement provides adequate protections in case of such a transfer.