In the event of a transfer of the Ledgers franchise after death or incapacity, is the payment of all monies owed to Ledgers, including the transfer fee, a condition for avoiding termination of the agreement?
Ledgers Franchise · 2025 FDDAnswer from 2025 FDD Document
B. Transfer
We may terminate this Agreement unless, within sixty (60) days of your death or incapacity, your executor, personal representative or guardian:
-
- seeks a transfer of your rights under this Agreement;
-
- completes the transfer within six (6) months of your death or incapacity;
-
- pays all monies owed to us, including the transfer fee, and
-
- signs the then-current transfer and release form
Source: Item 22 — CONTRACTS (FDD page 46)
What This Means (2025 FDD)
According to Ledgers's 2025 Franchise Disclosure Document, if a franchisee dies or becomes incapacitated, Ledgers may terminate the franchise agreement unless the executor, personal representative, or guardian seeks a transfer of rights within 60 days of the event and completes the transfer within six months. To avoid termination, the estate must pay all monies owed to Ledgers, including a transfer fee, and sign the current transfer and release form. The standard transfer fee is $5,000.
This requirement ensures that Ledgers continues to receive all outstanding payments and that the new franchisee is qualified and committed to the Ledgers system. The transferee must meet specific requirements, including completing initial training and entering into a new franchise agreement on the then-current form.
Ledgers is also entitled to reimbursement from the franchisee's estate for reasonable expenses incurred while continuing the operation of the franchised business, plus 10% of gross revenues for the period in which Ledgers operates or assists in the operation. This provision protects Ledgers's interests during the transition period and ensures compensation for their efforts in maintaining the business.