What is the definition of 'Asset Purchase Notice' in the context of transferring the Franchisee's Business for Bevaris Alliance?

According to Bevaris Alliance's 2024 Franchise Disclosure Document, an 'Asset Purchase Notice' is specifically defined in clause 16.7 of the franchise agreement. This notice is relevant when a franchisee wishes to transfer their Bevaris Alliance business to a third party and has received a legitimate offer to purchase the business.

Clause 16.7 stipulates that within 20 business days of Bevaris Alliance receiving an 'Asset Transfer Notice' from the franchisee, Bevaris Alliance has the option, but not the obligation, to issue a written 'Asset Purchase Notice' to the seller (franchisee). This notice indicates Bevaris Alliance's intent to purchase the franchisee's business at the 'Proposed Asset Sale Price,' which is the price offered by the third-party purchaser.

If Bevaris Alliance issues an 'Asset Purchase Notice,' the franchisee is then legally bound to sell the business to Bevaris Alliance at the agreed-upon 'Proposed Asset Sale Price.' The sale must be completed within 20 business days of the franchisee's receipt of the 'Asset Purchase Notice' from Bevaris Alliance. This clause effectively gives Bevaris Alliance the right of first refusal to purchase the franchise business before it can be sold to a third party.

This process ensures that Bevaris Alliance maintains control over who operates a franchise within its system and protects the brand's integrity. It also provides a mechanism for Bevaris Alliance to potentially expand its corporate-owned operations if it deems a particular franchise location valuable. Franchisees should understand these conditions regarding the transfer of their business and the implications for their exit strategy.