Does the definition of 'Transfer' by a Monicals Pizza franchisee include the transfer of the Franchise Agreement?
Monicals_Pizza Franchise · 2025 FDDAnswer from 2025 FDD Document
| k. "Transfer" by franchisee-definition | Section 18.2 | "Transfer" includes transfer of an interest in the franchise, the Franchise Agreement, the franchised restaurant's assets. | | l. Franchisor's approval | Section 18.2 | You may not transfer your interest in any of the | | of transfer by | | items listed in (k) above without our prior written | | franchisee | | consent. | | m. Conditions for franchisor's approval of transfer | Section 18.2 and Exhibit 6 | We will consent to a transfer if: we have not exercised our right of first refusal; all obligations owed to us are paid; you and the transferee have signed a General Release; the prospective transferee meets our business and financial standards; the transferee and all persons owning any interest in the transferee sign the then current franchise agreement (any franchisee holding a franchise agreement on | | Provision | Section in Franchise or Other Agreement | Summary | |-----------------------------------------------------------------------------------------------|--------------------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------| | | | April 1, 2008 may on one occasion transfer that | | | | franchise agreement to a transferee who shall then | | | | be entitled to retain, for so long as that transferee | | | | holds a franchise agreement from us, the 4% royalty | | | | rate in effect on April 1, 2008. All of the other | | | | terms and provisions of the then current Franchise | | | | Agreement [as of the date of the transfer] shall be | | | | fully effective against the transferee); you provide | | | | us with a copy of all contracts and agreements | | | | related to the transfer; you or the transferee pay a | | | | transfer fee of $10,000; the transferee or the owners | | | | of transferee have agreed to be personally bound by | | | | all provisions of the Franchise Agreement; you have | | | | agreed to guarantee performance by the transferee, | | | | if requested by us; the transferee has obtained all | | | | necessary consents and approvals of third parties; | | | | the transferee or all of its equity owners have signed | | | | a Nondisclosure and Non-Competition Agreement; | | | | the transferee has agreed that its designated manager | | | | will complete the initial training program before | | | | assuming management of the franchised restaurant; | | | | and the transferee has obtained all necessary types | | | | of insurance. | | n. Franchisor's right of first refusal to acquire franchisee's franchised restaurant | Section 19 | We may match an offer for your franchised restaurant or an ownership interest you propose to sell.
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 32–41)
What This Means (2025 FDD)
According to Monicals Pizza's 2025 Franchise Disclosure Document, the definition of "Transfer" by a franchisee does include the transfer of the Franchise Agreement. Specifically, the FDD states that "Transfer" includes the transfer of an interest in the franchise, the Franchise Agreement, and the franchised restaurant's assets.
This means that if a Monicals Pizza franchisee wants to sell their franchise, the Franchise Agreement itself is part of what is being transferred. As such, the franchisee must get Monicals Pizza's approval before transferring their interest in the Franchise Agreement.
Monicals Pizza will consent to a transfer if certain conditions are met. These conditions include that Monicals Pizza has not exercised its right of first refusal, all obligations owed to Monicals Pizza are paid, and both the franchisee and the transferee have signed a General Release. Additionally, the prospective transferee must meet Monicals Pizza's business and financial standards, sign the then-current franchise agreement, provide copies of all contracts related to the transfer, pay a $10,000 transfer fee, agree to be personally bound by the Franchise Agreement, and obtain necessary consents, approvals, and insurance. The transferee's designated manager must also complete the initial training program before assuming management of the franchised restaurant.