Does Bevaris Alliance have the right to terminate the agreement immediately for certain causes?
Bevaris_Alliance Franchise · 2024 FDDAnswer from 2024 FDD Document
o the standard required by the Manual for a period in excess of 60 days in any 90 day period, the Franchisor may appoint a manager of the Franchisee's Business who shall have full powers to operate the Franchisee's Business and to take all steps to ensure that the Franchisee complies with the terms of this agreement at the expense of the Franchisee.
18. Termination
- 18.1 Termination for cause by Franchisor. The Franchisor may terminate this agreement with immediate effect (or following such notice period as it sees fit) without prejudice to any of its rights or remedies, by giving written notice to the Franchisee and the Individual if:
- (a) the Franchisee or Individual fails to pay any amount due under this agreement on the due date for payment and remains in default not less than 7 (seven) days after being notified in writing to make such payment; or
- (b) the Franchisee or Individual commits a material breach of any term of this agreement (other than failure to pay any amounts due under this agreement), the Manual, or any other written agreement between the Franchisor and Franchisee or involving the Franchisee though Franchisee is not a party to such other written agreement (such as a Food Service Agreement) and (if such breach is remediable) fails to remedy that breach (or adequately assist Franchisor in the remedy of a Food Service Agreement) within a period of 14 (fourteen) days after being notified in writing to do so; or
- (c) the Individual or the Franchisee's employees fail to successfully complete the initial training referred to in clause 9; or
- (d) the Franchisee does not start business by the Commencement Date; or
- (e) the Franchisee or Individual repeatedly breaches any of the terms of this agreement in such a manner as to reasonably justify the opinion that its or
- his or her conduct is inconsistent with having the intention or ability to give effect to the terms of this agreement; or
- (f) the Franchisee or Individual gives to the Franchisor any false or misleading information, or makes any misrepresentation in connection with obtaining this agreement or during the Term, in connection with the Franchisee's Business; or
- (g) persistent, valid complaints continue to be made to the Franchisor about the quality of the service provided by the Franchisee and the Franchisee, having received notice of such complaints, fails to improve such service to the reasonable satisfaction of the Franchisor; or
- (h) the Franchisee or the Individual, in the reasonable opinion of the Franchisor, does, or permits to be done, any act which might jeopardize or invalidate the registration of the Trademarks or does any act which might assist, or give rise to, an application to remove the Trademarks, or which might prejudice the right or title of the Franchisor to the Trademarks; or
- (i) the Franchisee or the Individual purports to assign any of the rights or licenses granted under this agreement other than in accordance with the terms of this agreement; or
- (j) the Franchisee fails to obtain any written approval or consent of the Franchisor as expressly required by this agreement; or
- (k) the Franchisee or Individual suspends, or threatens to suspend, payment of its debts or is deemed to be insolvent, bankrupt, unable to pay its or their debts as they fall due for payment, or admits inability to pay its or their debts or deemed unable to pay its debts within the meaning of federal bankruptcy law or state insolvency law; or
- (l) the Franchisee or Individual commences negotiations with all or any class of its or their creditors with a view to rescheduling any of its or their debts, or enters into any composition or arrangement with its or their creditors generally; or
- (m) an order is made, a resolution is passed, or a notice is issued convening a meeting for the purpose of passing a resolution, or any analogous proceedings are taken, for the winding-up, administration or dissolution of the Franchisee;
Source: Item 23 — RECEIPT (FDD pages 22–88)
What This Means (2024 FDD)
According to Bevaris Alliance's 2024 Franchise Disclosure Document, Bevaris Alliance has the right to terminate the franchise agreement with immediate effect under certain conditions. Specifically, section 18.1 outlines various causes that allow Bevaris Alliance to terminate the agreement, potentially without any notice period, if it sees fit.
These causes include failure to pay amounts due under the agreement within seven days of written notice, committing a material breach of the agreement or manuals and failing to remedy it within 14 days of written notice, and failure of the franchisee's employees to complete initial training. Additional causes for immediate termination by Bevaris Alliance include not starting the business by the commencement date, repeated breaches of the agreement, providing false or misleading information to Bevaris Alliance, and persistent valid complaints about the quality of service.
Furthermore, Bevaris Alliance can terminate the agreement immediately if a liquidator, trustee in bankruptcy, or similar officer is appointed over the franchisee, or if a creditor takes possession of the franchisee's assets and such action is not discharged within 14 days. Other causes include the franchisee suspending business operations, the death or incapacity of the individual managing the franchise, a change of control of the franchisee, a criminal conviction of the individual, assessment of three or more Nonsufficient Funds Fees, or breach of compliance obligations.
These termination clauses are typical in franchise agreements to protect the franchisor's brand and maintain standards across the franchise system. A prospective Bevaris Alliance franchisee should carefully review these conditions to understand the circumstances under which their franchise can be terminated and the potential consequences of such termination.