In the event of the death of a Bang Cookies franchisee, who is responsible for transferring the interest?
Bang_Cookies Franchise · 2024 FDDAnswer from 2024 FDD Document
Notwithstanding the foregoing, if Franchisee is a Corporate Entity and the Managing Owner is the only Owner of Franchisee, then Article 14.D.(1) shall apply as if the Managing Owner were the sole individual Franchisee.
- (3) Upon the death of Franchisee or any Owner, the executor, administrator, conservator or other personal representative of that deceased person must transfer his interest to a person Franchisor approves within a reasonable time, not to exceed 12 months from the date of death.
- (4) If Franchisee is an individual, then in the event of the death or permanent disability of Franchisee, this Agreement may be Transferred to any designated person, heir or beneficiary without the payment of the Transfer Fee. Notwithstanding the immediately foregoing sentence, the Transfer of this Agreement to such transferee of Franchisee shall be subject to the applicable terms and conditions of this Article 14, and the Transfer shall not be valid or effective until Franchisor has received the properly executed legal documents, which Franchisor's attorneys deem necessary to properly and legally document such Transfer of this Agreement. Furthermore, said transferee must agree to be unconditionally bound by the terms and conditions of this Agreement, personally guarantee the performance of Franchisee's obligations under this Agreement, and execute the Franchise Owner and Spouse Agreement and Guaranty attached to this Agreement as Exhibit 1.
Source: Item 23 — RECEIPTS (FDD pages 56–245)
What This Means (2024 FDD)
According to Bang Cookies's 2024 Franchise Disclosure Document, in the event of the death of a franchisee or owner, the responsibility for transferring their interest falls to the executor, administrator, conservator, or other personal representative of the deceased person. This representative is required to transfer the deceased's interest to a person approved by Bang Cookies within a reasonable timeframe, specifically within 12 months from the date of death.
If the franchisee is an individual, the franchise agreement may be transferred to a designated person, heir, or beneficiary without the standard transfer fee. However, this transfer is still subject to the terms and conditions outlined in Article 14 of the franchise agreement. The transfer is not considered valid until Bang Cookies receives the necessary legal documents, deemed appropriate by their attorneys, to legally document the transfer.
The individual or entity to whom the franchise is transferred must agree to be unconditionally bound by the terms and conditions of the existing franchise agreement. They must also personally guarantee the performance of the franchisee's obligations under the agreement and execute the Franchise Owner and Spouse Agreement and Guaranty, which is attached to the agreement as Exhibit 1. This ensures that the new franchisee is fully committed to upholding the standards and responsibilities of the Bang Cookies franchise.
For a prospective Bang Cookies franchisee, this means that in the unfortunate event of death or permanent disability, there are clear procedures in place for transferring the franchise to a qualified individual. This provides some assurance that the business can continue operating under new management, subject to the franchisor's approval and adherence to the franchise agreement's terms.