If Bevaris Alliance exercises its option to purchase Your business, is no assumption of your liabilities a condition?

According to Bevaris Alliance's 2024 Franchise Disclosure Document, if Bevaris Alliance exercises its option to purchase a franchisee's business, one of the conditions is that there is no assumption of the franchisee's liabilities. This is detailed in Item 17, which outlines the terms related to renewal, termination, transfer, and dispute resolution.

Specifically, when Bevaris Alliance exercises its option to purchase the franchisee's business, the purchase will be based on the fair market value of the business, excluding any value for goodwill. Additionally, the franchisee must be in legal compliance at the time of purchase. The critical point is that Bevaris Alliance will not assume any of the franchisee's liabilities as part of the purchase.

This provision protects Bevaris Alliance from inheriting any outstanding debts, lawsuits, or other financial obligations of the franchisee. For a prospective franchisee, this means that if Bevaris Alliance decides to buy back the franchise, the franchisee remains responsible for any liabilities incurred during their ownership. It is important for franchisees to maintain sound financial and legal practices to avoid potential issues during the term of the franchise agreement and in the event of a buyback by Bevaris Alliance.