Under what circumstances related to incapacity, as defined in the Auntie Annes franchise agreement, does the transfer upon death or incapacity clause apply?
Auntie_Annes Franchise · 2024 FDDAnswer from 2024 FDD Document
- 16.6 Transfer Upon Death or Incapacity. If you or any Owner dies, becomes incapacitated, or enters bankruptcy proceedings, that person's executor, administrator, personal representative, or trustee must apply to us in writing within three months after the event (death, declaration of incapacity, or filing of a bankruptcy petition) for consent to Transfer the person's interest. The Transfer will be subject to the provisions of this Section 16, as applicable, except there shall be no transfer fee due. For purposes of this Section, "incapacity" means any physical or mental infirmity that will prevent the person from performing his or her obligations under this Agreement (i) for a period of 30 or more consecutive days or (ii) for 60 or more total days during a calendar year. In the case of Transfer by bequest or by intestate succession, if the heirs or beneficiaries are unable to meet the conditions of Section 16.3.E. (transferee meets qualifications), the executor may Transfer the decedent's interest to another successor that we have approved, subject to all of the terms and conditions for Transfers contained in this Agreement. If an interest is not disposed of under this Section 16.6 within 180 days after the date of death or appointment of a personal representative or trustee, we may terminate this Agreement.
Source: Item 22 — CONTRACTS (FDD page 106)
What This Means (2024 FDD)
According to Auntie Annes's 2024 Franchise Disclosure Document, the transfer upon death or incapacity clause is triggered when an owner experiences a physical or mental infirmity that prevents them from fulfilling their obligations under the Franchise Agreement. This incapacity must last for at least 30 consecutive days, or for a total of 60 days within a calendar year.
If an owner meets this definition of incapacity, their executor, administrator, personal representative, or trustee must apply in writing to Auntie Annes for consent to transfer the owner's interest within three months of the declaration of incapacity. This transfer is subject to the standard transfer provisions outlined in Section 16 of the agreement, but without any transfer fee.
If the heirs or beneficiaries are unable to meet the qualifications for a transferee, the executor can transfer the interest to another successor approved by Auntie Annes, adhering to all transfer terms and conditions. Should the interest remain unresolved within 180 days after the date of death or appointment of a personal representative or trustee, Auntie Annes reserves the right to terminate the Franchise Agreement.