What is the required action of the Individual if they wish to transfer their shares in the Franchisee of Bevaris Alliance?
Bevaris_Alliance Franchise · 2024 FDDAnswer from 2024 FDD Document
- 16.2 Share transfer notice. If the Individual wishes to transfer its shares in the Franchisee (Sale Shares) to a third party and has received an offer from a bona fide third-party purchaser for the Sale Shares, the Individual must first give a Transfer Notice to the Franchisor (giving details of the proposed transfer including):
- (a) the name of the proposed purchaser; and
- (b) the price (in cash) that the proposed purchaser has offered to pay for the Sale Shares (Proposed Sale Price).
- 16.3 Purchase notice. Within 20 Business Days of receipt (or deemed receipt) of a Transfer Notice, the Franchisor shall be entitled (but not obliged) to give notice in writing to the Individual that it wishes to purchase the Sale Shares at the Proposed Sale Price (Purchase Notice), in which case the Franchisor is bound to buy and the Individual is bound to sell all of the Sale Shares at the Proposed Sale Price, with such sale to complete within 20 Business Days of receipt (or deemed receipt) of the Purchase Notice.
- 16.4 Transfer where no Purchase Notice given. If, at the expiration of the initial period specified in clause 16.3, the Franchisor has not given a Purchase Notice, the Franchisee may transfer the Sale Shares to the proposed purchaser identified in the Transfer Notice at a price not less than the Proposed Sale Price provided that it does so within 60 days of the expiration of the initial 20 Business Day period specified in clause 16.3 and the criteria set out in clause 16.11 are satisfied.
- 16.5 Entire share transfer for cash only. The Individual shall not be permitted to transfer some only of its shares. Any transfer must be of the entire issued share capital of the Franchisee in accordance with this clause 16 and shall be for cash consideration only.
Source: Item 23 — RECEIPT (FDD pages 22–88)
What This Means (2024 FDD)
According to the 2024 FDD, if an individual franchisee of Bevaris Alliance wishes to transfer their shares, they must first provide a Transfer Notice to the franchisor. This notice must include the name of the proposed purchaser and the cash price offered for the shares, referred to as the Proposed Sale Price.
Within 20 business days of receiving the Transfer Notice, Bevaris Alliance has the option to issue a Purchase Notice, indicating their intent to buy the shares at the Proposed Sale Price. If Bevaris Alliance exercises this option, the individual is obligated to sell, and Bevaris Alliance is obligated to buy the shares at the agreed price, with the sale to be completed within 20 business days of the Purchase Notice.
If Bevaris Alliance does not issue a Purchase Notice within the initial 20-day period, the individual can proceed to transfer the shares to the proposed purchaser identified in the Transfer Notice. However, this transfer must occur within 60 days of the expiration of the initial 20-day period, and the sale price cannot be lower than the Proposed Sale Price. The transfer must be for the entire issued share capital of the Franchisee and must be for cash consideration only. Any transfer under this clause is subject to a Transfer Fee, with fifty percent due upon providing notice of the proposed transfer and the remaining fifty percent due upon the Franchisor's execution of the new agreement with the transferee.