Are transfers of an Aplus franchise due to death or incapacity subject to the standard assignment and transfer conditions outlined in the franchise agreement, and are there any exceptions based on state law?
Aplus Franchise · 2024 FDDAnswer from 2024 FDD Document
"Transfer" For purposes of this Agreement, "Transfer" as a verb means to sell, assign, give away, transfer, pledge, mortgage, or encumber either voluntarily or by operation of law (such as through divorce or bankruptcy proceedings) any interest in this Agreement, the License, the Store, substantially all the assets of the Store, or in the ownership of the franchisee (if you are an Entity). "Transfer" as a noun means any such sale, assignment, gift, transfer, pledge, mortgage or encumbrance.
Source: Item 23 — RECEIPT (FDD pages 68–302)
What This Means (2024 FDD)
According to Aplus's 2024 Franchise Disclosure Document, the term "Transfer" includes actions such as selling, assigning, giving away, transferring, pledging, mortgaging, or encumbering any interest in the Franchise Agreement, the license, the store, or the franchisee's ownership, whether voluntarily or by operation of law, including divorce or bankruptcy proceedings. This broad definition suggests that transfers due to death or incapacity would generally be subject to the standard transfer conditions outlined in the franchise agreement.
However, the document does not explicitly detail the specific procedures or exceptions related to transfers due to death or incapacity. It also does not specify whether state laws might provide exceptions to the standard transfer conditions.
A prospective Aplus franchisee should clarify with Aplus what specific procedures apply in the event of death or incapacity, and whether any state laws would override the standard transfer conditions in such situations. This will help them understand the potential implications for their heirs or estate.