In the event of termination for cause by Bevaris Alliance, what rights or remedies does the franchisor retain?
Bevaris_Alliance Franchise · 2024 FDDAnswer from 2024 FDD Document
7.3, clause 27.9, clause 27.13, clause 27.14, and clause 27.15 shall continue in force for a period of twenty four (24) months and subject to this clause 19, the parties shall have no further obligations under this agreement.
- 19.2 Accrued rights. Any termination or expiration of this agreement shall not affect any rights or liabilities that have accrued prior to such termination.
- 19.3 Cessation of business. On termination or expiration of this agreement for any reason, the Franchisee and the Individual shall:
- (a) immediately pay the Franchisor the full amount of all sums due from the Franchisee to the Franchisor together with any interest payable in accordance with clause 25.2;
- (b) cease to operate the Franchisee's Business and System and cease to trade under any of the Trademarks, and not hold the Franchisee out as a franchisee of the Franchisor or do anything that may indicate any relationship between them and the Franchisor;
- (c) not make or receive telephone calls in connection with the Branded Business;
- (d) immediately stop using the Intellectual Property, including the Trademarks;
- (e) pass all enquiries made after termination, and full details of potential Customers, to the Franchisor;
- (f) transfer all Customer lists and full details of contracts with Customers to the Franchisor, and if required by the Franchisor transfer all uncompleted contracts or unfulfilled orders to the Franchisor or its nominee;
- (g) cease to use the Franchise Software and other software supplied to the Franchisee by the Franchisor, and return or at the Franchisor's option, destroy, (without copying) all elements of it, including all software, data, hardware and documentation relating to it;
- (h) return or at the option of the Franchisor, destroy, all copies of the Manual, and other Products or materials bearing any of the Trademarks;
- (i) pay all debts owing to creditors of the Franchisee's Business, and irrevocably permit the Franchisor to deduct from all sums payable by the Franchisor to the Franchisee all sums which the Franchisor pays (whether legally obliged to or not) pursuant to this clause;
- (j) cease to use the Communications Addresses and not make or receive any telephone calls, faxes or emails in connection with the Branded Business, and take all steps that the Franchisor requires to transfer all listings of the Communications Addresses in any directory or other published materials to the Franchisor or as it may direct;
- (k) assign to the Franchisor all domain name registrations and rights in website content owned or used by the Franchisee in the Franchisee's Business; and
- (l) deliver up any mobile telephone SIM cards or other communications equipment used in the Franchisee's Business;
- (m) take all other steps and in particular execute and deliver to the Franchisor all documents necessary to comply with its obligations under clause 21 and clause 22 of this agreement; and
- (n) enable the Franchisor to enter the Franchisee's premises and gain access to the Franchisee's systems and data in order to verify compliance with this clause 19.
- 19.4 Repurchase of equipment. On termination or expiration of this agreement for any reason, the Franchisor may, at its option, repurchase any plant, equipment, fixtures and fittings used by the Franchisee for the purpose of the Franchisee's Business including the Equipment, at such price as the Franchisor reasonably considers to be its current market value. The Franchisee shall, at its expense, arrange all insurance and transport of such plant and equipment in accordance with the Franchisor's reasonable instructions. If the Franchisor does not exercise its option, the Franchisee shall be free to sell such items as it chooses.
Source: Item 23 — RECEIPT (FDD pages 22–88)
What This Means (2024 FDD)
According to Bevaris Alliance's 2024 Franchise Disclosure Document, if the franchise agreement is terminated for cause by Bevaris Alliance, the franchisor retains several rights and remedies. Upon termination, the franchisee must immediately pay all outstanding sums due to Bevaris Alliance, including any interest. The franchisee must also cease operating the Bevaris Alliance business and discontinue using any of the brand's trademarks, and must not present themselves as a franchisee of Bevaris Alliance.
Furthermore, the franchisee is required to stop using Bevaris Alliance's intellectual property, including trademarks, and must forward all inquiries and potential customer details to Bevaris Alliance. They must also transfer all customer lists and contract details to Bevaris Alliance and, if required, transfer any uncompleted contracts or unfulfilled orders to Bevaris Alliance or its designee. The franchisee must also stop using the franchise software and other software provided by Bevaris Alliance, returning or destroying all related elements, including software, data, hardware, and documentation.
The franchisee must return or destroy all copies of the manual and other products or materials bearing Bevaris Alliance's trademarks. They are also responsible for paying all debts owed to creditors of the franchise business, with Bevaris Alliance having the right to deduct any sums it pays to these creditors from any amounts owed to the franchisee. The franchisee must cease using communication addresses and transfer all listings of these addresses to Bevaris Alliance. Additionally, the franchisee must assign all domain name registrations and website content to Bevaris Alliance and deliver any mobile telephone SIM cards or other communication equipment used in the business.
Finally, the franchisee is obligated to take all necessary steps and deliver all documents required to comply with obligations related to confidentiality and non-competition. Bevaris Alliance is also permitted to enter the franchisee's premises to verify compliance with these post-termination obligations. Certain clauses of the agreement, such as those pertaining to termination consequences and general provisions, remain in effect for twenty-four months following termination, ensuring continued protection of Bevaris Alliance's interests.