What conditions must be met for Bevaris Alliance to approve a franchise transfer?
Bevaris_Alliance Franchise · 2024 FDDAnswer from 2024 FDD Document
| Provision | Section in Franchise Agreement | Summary |
|---|---|---|
| which must be approved by us. | ||
| l. Bevaris approval of transfer | Section | We have the right to approve all transfers, which shall be |
| by franchisee | 16.11 | subject to the provisions of the Franchise Agreement. |
| m. Conditions for Bevaris approval of transfer | Section 16.11 | Transferee approved by us, transfer fee paid, transferee not competitor, your account is current, you sign a release, transferee signs all documents, lender consents, and subordination agreements. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 17–18)
What This Means (2024 FDD)
According to Bevaris Alliance's 2024 Franchise Disclosure Document, the franchisor has the right to approve all franchise transfers, which are subject to the provisions outlined in the Franchise Agreement.
For Bevaris Alliance to approve a transfer, several conditions must be met. First, the transferee must be approved by Bevaris Alliance. Second, the franchisee must pay a transfer fee. Third, the transferee cannot be a competitor of Bevaris Alliance. Fourth, the franchisee's account with Bevaris Alliance must be current. Fifth, the franchisee must sign a release. Sixth, the transferee must sign all required documents. Seventh, the lender must provide consent. Finally, all necessary subordination agreements must be in place.
These conditions ensure that Bevaris Alliance maintains control over who operates its franchises and that the transfer process is conducted in a way that protects the franchisor's interests. Prospective franchisees should carefully review Section 16.11 of the Franchise Agreement to fully understand these requirements and their implications.
It is important to note that Bevaris Alliance also retains the right of first refusal to acquire the franchisee's business, meaning they can match any offer made by a potential buyer. Additionally, upon transfer, Bevaris Alliance has the option to purchase the business at fair market value, excluding any value for goodwill, ensuring legal compliance, and without assuming the franchisee's liabilities.