Under what conditions will Auntie Annes NOT consent to a transfer?
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)
Based on the 2024 Franchise Disclosure Document, Auntie Anne's outlines specific conditions regarding the transfer of a franchise interest due to death, incapacity, or bankruptcy. If a franchisee or any owner dies, becomes incapacitated, or enters bankruptcy proceedings, their executor, administrator, personal representative, or trustee must apply in writing to Auntie Anne's for consent to transfer the person's interest within three months of the event. This transfer is subject to the standard transfer provisions, but without a transfer fee.
Incapacity is defined as any physical or mental infirmity preventing the person from fulfilling their obligations under the Franchise Agreement for either 30 or more consecutive days, or for 60 or more total days during a calendar year. If the heirs or beneficiaries cannot meet the standard qualifications for a transferee, the executor may transfer the interest to another successor approved by Auntie Anne's, adhering to all transfer terms and conditions in the agreement.
However, if the interest is not properly disposed of within 180 days after the date of death or appointment of a personal representative or trustee, Auntie Anne's retains the right to terminate the Franchise Agreement. This clause ensures that the franchise remains operational and compliant with Auntie Anne's standards, even in unforeseen circumstances affecting the franchisee's ability to manage the business. This provision protects Auntie Anne's brand and operational consistency.