What is the condition for BKC to consent to a transfer of decedent's or incapacitated party's interest to Franchisee's heirs, surviving spouse, partner, or shareholder owning at least twenty-five percent (25%) of the Voting Common Stock of a corporation or twenty-five percent (25%) of the Voting Units of a limited liability company for a Burger King franchise?
Burger_King Franchise · 2025 FDDAnswer from 2025 FDD Document
In the event of the death or incapacity of Franchisee or, if this Agreement has been assigned to a corporation or a limited liability company, the death or incapacity of an owner of Voting Common Stock or Voting Units, BKC shall consent to a transfer of decedent's or incapacitated party's interest to Franchisee's heirs, surviving spouse, partner, or shareholder owning at least twenty-five percent (25%) of the Voting Common Stock of a corporation or twenty-five percent (25%) of the Voting Units of a limited liability company (collectively and individually an "Heir"), subject to the following conditions:
(1) The Heir must complete and be approved through BKC's standard franchisee selection process, including satisfactorily demonstrating to BKC that the Heir meets the financial, character, and managerial criteria, as well as equity ownership and such other criteria and conditions as BKC shall then be applying in considering applications for new franchises.
(2) The Heir shall have successfully completed BKC's training for new franchisees.
(3) The Heir shall agree, in writing, to assume liability for and to perform all the terms and conditions of this Agreement to the same extent as the original franchisee.
(4) If the Heir is not approved or there is no Heir, the estate of the deceased shall sell the Franchised Restaurant to an acceptable party within eighteen (18) months from the date of Franchisee's death or incapacity, and BKC shall have an option, but not the obligation, to operate and/or manage the Franchised Restaurant for the account of Franchisee's estate until the deceased or incapacitated Franchisee's interest is transferred to another party acceptable to BKC.
Source: Item 23 — RECEIPTS (FDD pages 127–995)
What This Means (2025 FDD)
According to Burger King's 2025 Franchise Disclosure Document, in the event of the death or incapacity of a franchisee, or an owner of Voting Common Stock or Voting Units, Burger King will consent to the transfer of the interest to the franchisee's heirs, surviving spouse, partner, or shareholder owning at least 25% of the Voting Common Stock or Voting Units, provided certain conditions are met. These individuals are collectively and individually referred to as an "Heir."
The first condition is that the Heir must complete and be approved through Burger King's standard franchisee selection process. This includes demonstrating that the Heir meets the financial, character, and managerial criteria, as well as equity ownership and other criteria that Burger King applies when considering new franchise applications.
Secondly, the Heir must successfully complete Burger King's training program for new franchisees. Finally, the Heir must agree in writing to assume liability for and perform all the terms and conditions of the Franchise Agreement to the same extent as the original franchisee. If the Heir is not approved or there is no Heir, the estate of the deceased must sell the franchised restaurant to an acceptable party within 18 months from the date of the franchisee's death or incapacity.