In Michigan, can Monicals Pizza refuse a transfer of ownership of a franchise without good cause?
Monicals_Pizza Franchise · 2025 FDDAnswer from 2025 FDD Document
Good cause shall include, but is not limited to:
The failure of the proposed transferee to meet the Franchisor's then-current reasonable qualifications or standards.
The fact that the proposed transferee is a competitor of the Franchisor or Subfranchisor.
The unwillingness of the proposed transferee to agree in writing to comply with all lawful obligations.
The failure of the Franchisee or proposed transferee to pay any sums owing to the Franchisor or to cure any default in the Franchise Agreement existing at the time of the proposed transfer.
Source: Item 23 — RECEIPTS (FDD pages 46–257)
What This Means (2025 FDD)
According to the 2025 Monicals Pizza Franchise Disclosure Document, in Michigan, Monicals Pizza can refuse a transfer of ownership of a franchise with good cause. Good cause includes several factors related to the proposed transferee's qualifications, conduct, and financial standing.
Specifically, Monicals Pizza can refuse a transfer if the proposed transferee does not meet the brand's current reasonable qualifications or standards. They can also refuse if the proposed transferee is a competitor. Refusal is also permitted if the proposed transferee is unwilling to agree in writing to comply with all lawful obligations or if either the franchisee or the proposed transferee has outstanding payments or defaults under the Franchise Agreement at the time of the proposed transfer.
This means that a Monicals Pizza franchisee in Michigan needs to ensure that any potential buyer meets Monicals Pizza's standards and is financially sound and willing to adhere to the franchise agreement. Failure to meet these conditions could result in Monicals Pizza legitimately blocking the transfer. Franchisees in Michigan should be aware of these conditions to avoid potential issues when attempting to sell their franchise.