Where in the Burger King franchise agreement can I find details regarding the conditions and limitations for assignment of the agreement?
Burger_King Franchise · 2025 FDDAnswer from 2025 FDD Document
- (1) That all of Franchisee's accrued monetary obligations and all other outstanding obligations to BKC and its Affiliates, whether arising under this Agreement or otherwise, have been satisfied;
- (2) That Franchisee is not in default of any provision of this Agreement, any amendment hereof or successor hereto, or any other agreement between Franchisee and BKC or its Affiliates;
- (3) That the transferee (or, if applicable, such owners of the transferee as BKC may request), in BKC's sole judgment, satisfies all of BKC's business standards and requirements; has the aptitude and ability to operate the Franchised Restaurant; and has adequate financial resources and capital to do so; and that transferee complete and be approved through BKC's standard franchisee application and selection process including satisfactorily demonstrating to BKC that transferee meets the financial, character, managerial, ownership and such other requirements, criteria and conditions as BKC shall then be applying in considering applications for new franchises, including transferee, and the Managing Owner identified by transferee satisfactorily completing all BKC's training requirements;
- (4) That the transferee, at BKC's election, consistent with then current BKC policy, (a) enter into a written assignment, in a form satisfactory to BKC, assuming and agreeing to discharge all of Franchisee's obligations under this Agreement, or (b) execute, for a term ending on the Expiration Date of this Agreement, BKC's then-current form of BURGER KING Restaurant franchise agreement applicable to such transferee and such other ancillary agreements as BKC may require for the Franchised Restaurant; provided, however, that the royalty and advertising contribution rates shall be the
Source: Item 22 — CONTRACTS (FDD pages 125–127)
What This Means (2025 FDD)
According to Burger King's 2025 Franchise Disclosure Document, the conditions and limitations for assignment of the franchise agreement can be found in the contract itself. Specifically, the franchise agreement states that the franchisee may, with prior written consent from Burger King, assign the agreement to a corporation if certain conditions are met.
These conditions include ensuring that all of the franchisee's monetary and outstanding obligations to Burger King and its affiliates are satisfied. Additionally, the franchisee must not be in default of any provision within the agreement or any other agreement with Burger King or its affiliates. The transferee must also meet Burger King's business standards and requirements, demonstrating the aptitude, ability, and adequate financial resources to operate the franchised restaurant. The transferee must also complete Burger King's standard franchisee application and selection process, meeting the financial, character, managerial, and ownership criteria that Burger King applies to new franchisees.
Furthermore, the transferee must either enter into a written assignment assuming all obligations under the existing agreement or execute Burger King's current franchise agreement for the remaining term, along with any other required ancillary agreements. If a new franchise agreement is required, it will supersede the original agreement, although the royalty and advertising contribution rates will remain the same. Burger King also retains the right of first refusal, allowing it to purchase the interests covered by any offer to transfer the franchise. Any sale or transfer without offering Burger King this right of first refusal is considered void.