Can the Gokhale Method agreement be assigned to effect termination of the agreement?
Gokhale_Method Franchise · 2024 FDDAnswer from 2024 FDD Document
ay request.
- 14.2. Transfer by You. You do not have any right to transfer this agreement. It shall immediately terminate and be of no further force or effect, except for provisions that by their terms survive termination, if you attempt to transfer this Agreement. This Agreement cannot be transferred or devised upon your death or incompetency. Some states may require that we allow you to transfer this agreement in certain circumstances. If the law of any such state is determined to apply to this agreement, then we may impose requirements upon transfer, including payment of a transfer fee of $5,000 and our attorneys' fees and the prior qualification of the transferee to teach the Gok
Source: Item 22 — CONTRACTS (FDD page 34)
What This Means (2024 FDD)
According to the 2024 Gokhale Method Franchise Disclosure Document, a franchisee's attempt to transfer the franchise agreement will result in immediate termination of the agreement. Specifically, the FDD states that the franchisee does not have the right to transfer the agreement, and any attempt to do so will cause it to immediately terminate. There is an exception, however, as some states may require Gokhale Method to allow a transfer in certain circumstances.
If a state law requires Gokhale Method to allow a transfer, the company may impose requirements such as a $5,000 transfer fee, attorney's fees, and the prior qualification of the transferee to teach the Gokhale System. This means that even if a transfer is permitted due to state law, the franchisee may still incur costs and the proposed transferee must meet Gokhale Method's standards.
This policy is fairly common in franchising, as franchisors typically want to maintain control over who operates their franchises to protect brand standards and reputation. The Gokhale Method's approach ensures that any potential new franchisee meets their qualifications and that the transfer process is managed according to their requirements, even when state laws mandate some flexibility.