What is one of the conditions that Jersey Mike's may impose for consenting to an Asset Transfer?
Jersey_Mikes Franchise · 2025 FDDAnswer from 2025 FDD Document
- 19.2 Conditions to Voluntary Transfer of Rights. Neither Franchisee nor any Principal (defined in Section 31) shall effectuate an Asset Transfer (defined in Section 31) before the Franchised Restaurant opens for business under any circumstances. After the Franchised Restaurant opens for business, any Asset Transfer will be subject to Franchisor's prior written consent, in its sole and absolute discretion. Franchisor may condition its consent on compliance with certain requirements, including, without limitation, any of the following (which Franchisee agrees are reasonable):
- a. At the time of A sset Transfer, Franchisee is in full compliance with Franchisee's obligations under this Agreement and all other agreements between Franchisee and Franchisor and its Affilia tes, including payment of all monetary obligations due Franchisor and its Affiliates;
Source: Item 22 — CONTRACTS (FDD page 77)
What This Means (2025 FDD)
According to Jersey Mike's 2025 Franchise Disclosure Document, Jersey Mike's may require, as a condition of consenting to an asset transfer, that the franchisee is in full compliance with all obligations under the Franchise Agreement and all other agreements with Jersey Mike's and its affiliates. This includes ensuring that all monetary obligations due to Jersey Mike's and its affiliates are paid in full at the time of the asset transfer.
This condition means that a franchisee looking to sell their Jersey Mike's location must be current on all payments and in adherence to all contractual obligations. This protects Jersey Mike's by ensuring that the franchisee has operated the business responsibly up to the point of sale and hasn't neglected any financial or operational duties.
For a prospective franchisee, this highlights the importance of maintaining good standing with Jersey Mike's throughout the term of the franchise agreement. Failure to meet financial or operational obligations could impede the ability to transfer the franchise in the future. This is a fairly standard requirement in franchising, as franchisors typically want to ensure that any transfer reflects positively on the brand.