What happens to the Bang Cookies Multi-Unit Development Agreement in the event of the franchisee's death or disability?
Bang_Cookies Franchise · 2024 FDDAnswer from 2024 FDD Document
| n. | Franchisor's right of first refusal to acquire franchisee's business | 14.F. | We have the right to match any offer to purchase your Shop or the Corporate Entity operating your Shop. |
|---|---|---|---|
| o. | Franchisor's option to purchase franchisee's business | Not applicable | Not applicable. |
| p. | Death or disability of franchisee | 14.D. | If you are an individual, within 30 days of the death or permanent disability of Franchisee, your executor and/or legal representative must appoint an Operating Manager approved by us and within 60 days of such appointment the Operating Manager must complete, to our satisfaction, our initial training program. Within 12 months of the date of death or disability, the Franchise Agreement must be transferred to a transferee approved by us and otherwise transferred in accordance with the terms of the Franchise Agreement. If the franchisee is a Corporate Entity, within 30 days of the death or permanent disability of your Managing Owner, if there are other Owners, must appoint a replacement Operating Manager approved by us and within 60 days of such appointment the replacement Operating Manager must complete, to our satisfaction, our initial training program. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 42–49)
What This Means (2024 FDD)
According to Bang Cookies's 2024 Franchise Disclosure Document, the handling of the franchise agreement following the death or disability of a franchisee depends on whether the franchisee is an individual or a corporate entity. If the franchisee is an individual, their executor or legal representative has 30 days from the date of death or permanent disability to appoint an Operating Manager approved by Bang Cookies. This Operating Manager must then complete Bang Cookies's initial training program to the company's satisfaction within 60 days of their appointment. Furthermore, within 12 months of the date of death or disability, the Franchise Agreement must be transferred to a transferee approved by Bang Cookies, following the standard transfer terms outlined in the Franchise Agreement.
If the franchisee is a corporate entity and its Managing Owner dies or becomes permanently disabled, the other Owners, if any, have 30 days to appoint a replacement Operating Manager approved by Bang Cookies. This replacement Operating Manager must complete the initial training program to Bang Cookies's satisfaction within 60 days of their appointment.
These stipulations ensure that even in unforeseen circumstances such as death or disability, the Bang Cookies franchise can continue operating under competent management and according to the brand's standards. The requirement for a transfer within a specific timeframe ensures that the franchise is eventually taken over by an approved and capable owner, maintaining the integrity and consistency of the Bang Cookies brand. This also protects the investment of both the franchisee (or their estate) and Bang Cookies itself.