What section of the Fly To Fit agreement must a transfer upon death or incapacity comply with?
Fly_To_Fit Franchise · 2024 FDDAnswer from 2024 FDD Document
- 15.4 Transfer upon Death or Incapacity. Upon the death or incapacity of Franchisee (or, if Franchisee is an entity, the Owner with the largest ownership interest in Franchisee), the executor, administrator, or personal representative of that person must Transfer the Business to a third party approved by Fly To Fit Franchise (or to another person who was an Owner at the time of death or incapacity of the largest Owner) within nine months after death or incapacity.
Such transfer must comply with Section 15.2.
Source: Item 22 — CONTRACTS (FDD page 44)
What This Means (2024 FDD)
According to the 2024 Fly To Fit Franchise Disclosure Document, if a Fly To Fit franchisee dies or becomes incapacitated, the transfer of the business must comply with Section 15.2 of the franchise agreement. This section outlines the general conditions for transfers by the franchisee.
Section 15.2 specifies that Fly To Fit must receive at least 60 days' notice before any proposed transfer. Fly To Fit's consent is required for the transfer, and Fly To Fit can impose conditions. These conditions include paying a transfer fee of $10,000 plus any broker fees and out-of-pocket costs incurred by Fly To Fit. The proposed assignee must also complete Fly To Fit's franchise application process, meet the then-applicable standards for new franchisees, and be approved by Fly To Fit.
Furthermore, the proposed assignee cannot be a competitor and must execute Fly To Fit's current form of franchise agreement, which may contain materially different provisions. All owners of the proposed assignee must provide a guaranty in accordance with Section 2.5. The franchisee must have paid all monetary obligations to Fly To Fit and not be in default of any agreements. Finally, the proposed assignee and their owners and employees must undergo any training that Fly To Fit may require.