What is the minimum acceptable price for the transfer of the Franchisee's Business by the Franchisee of Bevaris Alliance?
Bevaris_Alliance Franchise · 2024 FDDAnswer from 2024 FDD Document
- (b) the price (in cash) that the proposed purchaser has offered to pay for the Franchisee's Business (Proposed Asset Sale Price).
16.7 Asset Purchase Notice. Within 20 Business Days of receipt (or deemed receipt) of an Asset Transfer Notice, the Franchisor shall be entitled (but not obliged) to give notice in writing to the Seller that it wishes to purchase the Franchisee's Business at the Proposed Asset Sale Price (Asset Purchase Notice), in which case the Franchisor is bound to buy and the Franchisee is bound to sell the Franchisee's Business at the Proposed Asset Sale Price, with such sale to complete within 20 Business Days of receipt (or deemed receipt) of the Asset Purchase Notice.
16.8 Transfer of Franchisee's Business third party. If, at the expiration of the initial period specified in clause 16.7, the Franchisor has not given an Asset Purchase Notice, the Franchisee may transfer the Franchisee's Business to the third party purchaser identified in the Asset Transfer Notice at a price not less than the Proposed Asset Sale Price provided that it does so within 60 days of the expiration of the initial 20 Business Day period specified in clause 16.7 and the criteria set out in clause 16.11 are satisfied.
Source: Item 23 — RECEIPT (FDD pages 22–88)
What This Means (2024 FDD)
According to the 2024 Bevaris Alliance Franchise Disclosure Document, if a franchisee decides to sell their Bevaris Alliance business to a third party, the sale price must be no less than the price offered to Bevaris Alliance itself. Specifically, before a franchisee can transfer their business, they must first provide Bevaris Alliance with an Asset Transfer Notice, which includes the proposed sale price from the potential buyer.
Bevaris Alliance then has the option to purchase the franchise business at this "Proposed Asset Sale Price." If Bevaris Alliance declines to exercise this option within a specified timeframe (20 business days), the franchisee is then permitted to proceed with the sale to the third party.
However, the sale to the third party must occur within 60 days of the expiration of Bevaris Alliance's initial option period, and the price cannot be lower than the "Proposed Asset Sale Price" that was initially offered to Bevaris Alliance. This ensures that Bevaris Alliance has the first right of refusal and that the franchisee cannot sell the business for less than what Bevaris Alliance was offered.