Under what condition is the transfer of a Bft franchise interest due to death or disability NOT considered a transfer by the franchisee?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
14.3 Death or Disability of Franchisee. In the event of the death or disability of Franchisee, if an individual, or of a stockholder of a corporate Franchisee, or of a partner of a Franchisee which is a partnership, or a member of a Franchisee which is a limited liability company, the transfer of Franchisee's or the deceased stockholder's, partner's or member's interest in this Agreement to his or her heirs, trust, personal representative or conservators, as applicable, must occur within six (6) months of the death or disability, but, shall neither be deemed a Transfer by Franchisee (provided that the responsible management employees or agents of Franchisee have been satisfactorily trained at Franchisor's Initial Training Program) nor obligate Franchisee to pay any transfer fee.
If Franchisor determines (i) there is no imminent transfer to a qualified successor or (ii) there is no heir or other principal person capable of operating the Studio, Franchisor shall have the right, but not the obligation, to immediately appoint a manager and commence operating the Studio on behalf of Franchisee or its estate.
Franchisee shall be obligated to, and shall, pay to Franchisor all reasonable costs and expenses for such management assistance, including without limitation, the manager's salary, room and board, travel expenses and all other related expenses of the Franchisor appointed manager.
Operation of the Studio during any such period shall be for and on behalf of Franchisee, provided that Franchisor shall only have a duty to utilize reasonable efforts and shall not be liable to Franchisee or its owners for any debts, loses or obligations incurred by the Studio, or to any creditor of Franchisee for any supplies, inventory, equipment, furniture, fixtures or services purchased by the Studio during any period in which it is managed by a Franchisor appointed manager.
Franchisor may, in its sole discretion, extend the six (6) month period of time for completing a transfer contemplated by this Section.
Source: Item 23 — RECEIPTS (FDD pages 79–265)
What This Means (2025 FDD)
According to Bft's 2025 Franchise Disclosure Document, a transfer of the franchise interest due to death or disability is not considered a transfer by the franchisee under specific conditions. This applies if the franchisee is an individual, a stockholder of a corporate franchisee, a partner of a partnership franchisee, or a member of a limited liability company franchisee.
Specifically, the transfer of the franchisee's interest to their heirs, trust, personal representative, or conservators must occur within six months of the death or disability. This transfer will not be deemed a transfer by the franchisee, provided that the responsible management employees or agents of the franchisee have been satisfactorily trained at Bft's Initial Training Program. Under these conditions, the franchisee is also not obligated to pay any transfer fee.
However, if Bft determines that there is no imminent transfer to a qualified successor or no heir or other principal person capable of operating the studio, Bft has the right to appoint a manager and commence operating the studio on behalf of the franchisee or its estate. The franchisee will be responsible for all reasonable costs and expenses for such management assistance, including the manager's salary, room and board, travel expenses, and other related expenses. Bft may extend the six-month period for completing the transfer at its discretion.