Is a transfer fee required for any transfer under clause 16 of the Bevaris Alliance agreement?
Bevaris_Alliance Franchise · 2024 FDDAnswer from 2024 FDD Document
- 16.14 Transfer Fee. Any transfer under this clause 16 shall be subject to a Transfer Fee. Fifty percent of the Transfer Fee shall be due and payable upon Franchisee's providing of notice of the proposed transfer to Franchisor pursuant to clauses 16.2 or 16.6 of this agreement, and the remaining fifty percent of the Transfer Fee shall be due and payable upon Franchisor's execution of the new agreement with the transferee.
Source: Item 23 — RECEIPT (FDD pages 22–88)
What This Means (2024 FDD)
According to the 2024 Bevaris Alliance Franchise Disclosure Document, any transfer under clause 16 of the franchise agreement is subject to a transfer fee. This fee is equal to 50% of the then-current initial franchise fee.
The transfer fee is payable in two installments. The first 50% of the transfer fee is due when the franchisee provides notice of the proposed transfer to Bevaris Alliance, as per clauses 16.2 or 16.6 of the agreement. The remaining 50% is due upon Bevaris Alliance's execution of the new franchise agreement with the transferee.
This means that a franchisee considering a transfer needs to be prepared to pay this fee. The initial payment is required simply to initiate the transfer process, with the final payment due upon completion of the transfer. This fee structure ensures that Bevaris Alliance is compensated for the administrative and legal work involved in approving and processing the transfer, as well as for the value of the franchise being transferred to a new owner.