What happens to the term of the transferee's Jersey Mikes Development Agreement and Franchise Agreement after a transfer?

According to Jersey Mike's 2025 Franchise Disclosure Document, if a developer or franchisee transfers their rights under the Development Agreement or Franchise Agreement, the transferee must execute Jersey Mike's then-current form of agreement. This new agreement for the transferee will limit the term to the unexpired term of the original agreement.

In simpler terms, if a franchisee sells their Jersey Mike's location with five years remaining on the original franchise agreement, the new franchisee's agreement will only last for those remaining five years. The transferee essentially steps into the shoes of the transferor for the balance of the original term.

This condition ensures that Jersey Mike's can periodically update its franchise agreements and standards. It also allows the company to reassess the relationship with each franchisee at the end of the original term, rather than being bound indefinitely to the terms of an older agreement or an undesirable franchisee. For a potential buyer, it's crucial to understand the remaining term of the agreement they are assuming, as it directly impacts the length of time they can operate the franchise under the existing terms.