What happens to the Aplus franchise agreement if an approved transfer is not effected within the designated time frame following a death or permanent incapacity?
Aplus Franchise · 2024 FDDAnswer from 2024 FDD Document
Upon the death or permanent incapacity (mental or physical) of the Developer or any Owner, the executor, administrator, or personal representative of such person shall transfer such interest to a third party approved by Franchisor within six months after such death or mental incapacity.
Such transfers, including, without limitation, transfers by devise or inheritance, shall be subject to the same conditions as an inter vivos transfer, except that the transfer fee shall be waived.
In the case of transfer by devise or inheritance, however, if the heirs or beneficiaries of any such person are unable to meet the conditions of this Section 8, the executor, administrator, or personal representative of the decedent shall transfer the decedent's interest to another party approved by Franchisor within six months, which disposition shall be subject to all the terms and conditions for transfer contained in this Agreement.
If the interest is not disposed of within such period, Franchisor may, at its option, terminate this Agreement, pursuant to Section 9.5.
Source: Item 22 — CONTRACTS (FDD page 68)
What This Means (2024 FDD)
According to Aplus's 2024 Franchise Disclosure Document, if a franchisee dies or becomes permanently incapacitated, their interest must be transferred to a third party approved by Aplus within six months. This transfer is handled by the executor, administrator, or personal representative of the deceased or incapacitated person. The transfer is subject to the same conditions as a regular transfer, but the transfer fee is waived.
However, if the heirs or beneficiaries are unable to meet the standard transfer conditions, the executor, administrator, or personal representative must still transfer the interest to another Aplus-approved party within the same six-month period. This disposition remains subject to all the standard transfer terms and conditions outlined in the Aplus franchise agreement.
If the transfer of the Aplus franchise interest does not occur within this six-month timeframe, Aplus has the option to terminate the franchise agreement. This clause ensures that Aplus maintains control over who operates its franchises, even in cases of death or incapacitation, and prevents the franchise from being tied up indefinitely in legal or familial disputes.