What is the Bevaris Alliance franchisee's obligation regarding outstanding payments upon termination or expiration?
Bevaris_Alliance Franchise · 2024 FDDAnswer from 2024 FDD Document
- 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;
Source: Item 23 — RECEIPT (FDD pages 22–88)
What This Means (2024 FDD)
According to the 2024 Bevaris Alliance Franchise Disclosure Document, upon termination or expiration of the franchise agreement, the franchisee is obligated to pay Bevaris Alliance the full amount of all outstanding sums due, including any interest payable as per clause 25.2 of the agreement. This means that any unpaid franchise fees, royalties, or other debts owed to Bevaris Alliance must be settled immediately. This obligation is clearly stated in section 19.3(a) of the FDD, emphasizing the financial responsibilities of the franchisee upon exiting the franchise system.
This requirement ensures that Bevaris Alliance recovers all outstanding dues, which is a standard practice in franchising to protect the franchisor's financial interests. Franchisees should be aware of this obligation and plan accordingly to avoid any legal or financial repercussions. The franchisee must also cease operating the Bevaris Alliance business and discontinue using any of Bevaris Alliance's trademarks or intellectual property.
Furthermore, the individual who guaranteed the franchisee's obligations also bears responsibility for these payments. Clause 22.1(b) states that the individual guarantees the punctual payment of all sums payable by the franchisee under the agreement. This guarantee underscores the importance of fulfilling all financial obligations to Bevaris Alliance, even after the termination or expiration of the franchise agreement. The survival clause 19.1(a) also states that clause 19 remains in full force and effect after termination or expiration.