Can Bevaris Alliance transfer the benefit of any party's obligations under the agreement?
Bevaris_Alliance Franchise · 2024 FDDAnswer from 2024 FDD Document
he prior written consent of the Franchisor (such consent not to be unreasonably conditioned, withheld or delayed), assign, transfer, mortgage, charge, declare a trust of, sub-contract, delegate or deal in any other manner with:
- (a) this agreement or any of their rights and obligations under it (or any document referred to in it); or
- (b) the Franchisee's Business, or purport to do any of the same.
- 23.2 The Franchisor may, at any time, assign (absolutely or by way of security and in whole or in part), transfer, mortgage, charge or deal in any other manner with the benefit of any or all of any other party's obligations or any benefit arising under this agreement.
- 23.3 If there is an assignment pursuant to clause 23.2:
- (a) the Franchisee and Individual shall discharge their obligations under this agreement to the Franchisor until they receive written notice of the assignment;
- (b) the assignee may enforce this agreement as if it were a party to it, but the Franchisor shall remain liable for its obligations under this agreement;
- (c) the liability of the Franchisee and Individual to any assignee cannot be greater than their liability to the Franchisor;
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 transfer the benefits of obligations under the franchise agreement. Specifically, clause 23.2 states that Bevaris Alliance may assign, transfer, mortgage, charge, or deal with the benefit of any party's obligations or any benefit arising under the agreement. This means Bevaris Alliance can transfer its rights to receive certain benefits or performances outlined in the agreement to another party.
This clause also outlines the implications for the franchisee and individual in the event of such a transfer. According to clause 23.3(a), the franchisee and individual must continue to fulfill their obligations to Bevaris Alliance until they receive written notice of the assignment. After receiving notice, they must then discharge their obligations to the assignee. Clause 23.3(b) clarifies that the assignee can enforce the agreement as if they were a party to it, but Bevaris Alliance remains liable for its own obligations under the agreement.
Furthermore, clause 23.3(c) states that the franchisee and individual's liability to any assignee cannot exceed their liability to Bevaris Alliance. This provides some protection to the franchisee, ensuring they are not exposed to greater liabilities simply because of the assignment. Bevaris Alliance also has the right to disclose information about the agreement and the franchisee to a proposed assignee, as stated in clause 23.3(d), but only after providing notice of the assignee's identity to the franchisee and individual, according to clause 23.3(e).
This ability to assign benefits is a fairly standard practice in franchising, allowing Bevaris Alliance flexibility in its business operations, such as in cases of corporate restructuring, financing, or sale of the franchise system. However, franchisees should be aware of this clause and understand their obligations in the event of an assignment, ensuring they receive proper notice and that their liabilities are not increased as a result.