In the event of death or permanent disability of a Baya Bar franchisee, how long does the representative have to transfer the interest?
Baya_Bar Franchise · 2024 FDDAnswer from 2024 FDD Document
ys after the offer is given to Franchisor or (ii) there is any material change in the terms of the offer, the offer will again be subject to Franchisor's right of first refusal.
- 16.7 Death or Permanent Disability. The grant of rights under this Agreement is personal to Franchisee, and on the death or permanent disability of Franchisee or any of Franchisee's Principals, the executor, administrator, conservator or other personal representative of Franchisee or Principal, as the case may be, shall be required to transfer Franchisee's or Principal's interest in this Agreement within six (6) months from the date of death or permanent disability to a third party approved by Franchisor. Failure to transfer in accordance with the forgoing will constitute a material default and the Franchise granted by this Agreement will terminate. A transfer under this Section 16.7, including without limitation, transfer by devise or inheritance, is subject to the conditions for Transfers in this Article 16 and unless transferred by gift, devise or inheritance, subject to the terms of Section 16.6 above. For purposes of this Agreement, the term "permanent disability" means a mental or physical disability, impairment or condition that is reasonably expected to prevent or actually does prevent such person from providing continuous and material supervision of the operation of Franchisee's Franchised Business during the six (6)-month period from its onset.
Source: Item 22 — CONTRACTS (FDD page 56)
What This Means (2024 FDD)
According to Baya Bar's 2024 Franchise Disclosure Document, in the event of the death or permanent disability of a franchisee or one of their principals, the executor, administrator, conservator, or other personal representative is required to transfer the franchisee's interest in the Franchise Agreement within six months from the date of death or permanent disability. Failure to transfer the interest within this timeframe will constitute a material default, leading to the termination of the franchise.
This transfer is subject to the standard conditions for transfers outlined in the agreement. This includes the requirement that Baya Bar approves the third party to whom the franchise interest is being transferred. The FDD defines "permanent disability" as a mental or physical condition that prevents the franchisee from providing continuous and material supervision of the Baya Bar franchise during a six-month period from the disability's onset.
During the period following the death or permanent disability, Baya Bar requires the franchise to be supervised by an interim successor manager who is satisfactory to Baya Bar. Alternatively, Baya Bar may, at its discretion, provide interim management support for a fee. This ensures the continued operation of the Baya Bar franchise during the transition period. This requirement aims to protect the brand and maintain operational standards while the transfer of ownership is being finalized.