Are transfers of a Burros Fries franchise by devise or inheritance subject to the same restrictions as inter vivos transfers?
Burros_Fries Franchise · 2024 FDDAnswer from 2024 FDD Document
D. Transfer Upon Death or Mental Incapacity
Upon the death or mental incapacity of any person with an interest in Business, the executor, administrator, or personal representative of that person must transfer such interest to a third party approved by us within six (6) months after death or mental incapacity. These transfers, including, without limitation, transfers by devise or inheritance, will be subject to the same restrictions and conditions as any inter vivos transfer. However, in the case of a transfer by devise or inheritance, if the heirs or beneficiaries of any deceased person are unable to meet the conditions of this Agreement, the personal representative of the deceased Franchisee shall have six (6) months to dispose of the deceased's interest inthe Business, which disposition will be subject to all the terms and conditions for transfer contained in this Agreement. If the interest is not disposed of within six (6) months, we may terminate this Agreement.
Source: Item 22 — CONTRACTS (FDD page 53)
What This Means (2024 FDD)
According to the 2024 Burros Fries Franchise Disclosure Document, transfers of a franchise due to death or mental incapacity are subject to the same restrictions and conditions as any other transfer made during the franchisee's lifetime (inter vivos). This means that the executor, administrator, or personal representative must transfer the interest to a third party approved by Burros Fries within six months of the event.
If the heirs or beneficiaries cannot meet the requirements of the Franchise Agreement, the personal representative has six months to sell the deceased's interest, subject to all transfer terms in the agreement. If the interest isn't properly transferred within those six months, Burros Fries has the right to terminate the Franchise Agreement.
This clause ensures that Burros Fries maintains control over who operates its franchises, even in cases of death or incapacity. A prospective franchisee should carefully consider these transfer conditions, as they could impact the future of the franchise and its value to their heirs.