To whom must the Chocolate Bash business be transferred upon death or incapacity of the franchisee?

According to Chocolate Bash's 2024 Franchise Disclosure Document, in the event of the death or incapacity of the franchisee, or the person with the largest ownership interest if the franchisee is an entity, the business must be transferred to a third party approved by Chocolate Bash. The executor, administrator, or personal representative is responsible for completing this transfer.

This transfer must occur within nine months of the death or incapacity and must comply with the standard transfer requirements outlined in Section 15.2 of the Franchise Agreement. This means that the potential buyer will need to be approved by Chocolate Bash, and the franchisor retains the right of first refusal to purchase the franchise under the same terms offered to the third party.

This provision ensures that Chocolate Bash maintains control over who operates its franchises, even in unforeseen circumstances. For a prospective franchisee, this highlights the importance of having a succession plan and understanding the transfer requirements to ensure a smooth transition and avoid potential conflicts or loss of the business. It is also important to consider the financial implications of a potential forced sale, as the price and terms may not be ideal.