Does the transferee of a Bevaris Alliance franchise need to be approved by Bevaris Alliance?
Bevaris_Alliance Franchise · 2024 FDDAnswer from 2024 FDD Document
| Provision | Section in Franchise Agreement | Summary |
|---|---|---|
| which must be approved by us. | ||
| l. Bevaris approval of transfer | Section | We have the right to approve all transfers, which shall be |
| by franchisee | 16.11 | subject to the provisions of the Franchise Agreement. |
| m. Conditions for Bevaris approval of transfer | Section 16.11 | Transferee approved by us, transfer fee paid, transferee not competitor, your account is current, you sign a release, transferee signs all documents, lender consents, and subordination agreements. |
| n. Bevaris’ right of first refusal to acquire franchisee’s business | Section 16.3 | Bevaris can match any offer for the purchase of Your franchise at Bevaris’ option. |
| o. Bevaris’ option to purchase Your business | Section 16.7 | Upon transfer, fair market value (but no value for goodwill), legal compliance, no assumption of your liabilities. |
| p. Death or disability of | Section 17 | Franchise may be assigned by estate to approve transferee |
| franchisee | in three months. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 17–18)
What This Means (2024 FDD)
According to Bevaris Alliance's 2024 Franchise Disclosure Document, Bevaris Alliance retains the right to approve all franchise transfers. Specifically, the FDD outlines that any transfer of a Bevaris Alliance franchise by a franchisee requires the franchisor's approval, and such approval is subject to the provisions detailed in the Franchise Agreement. This requirement ensures that Bevaris Alliance maintains control over who enters their franchise system.
Several conditions must be met for Bevaris Alliance to approve a transfer. These conditions include the transferee being approved by Bevaris Alliance, payment of a transfer fee, and confirmation that the transferee is not a competitor. Additionally, the franchisee's account must be current, and the franchisee must sign a release. The transferee is also required to sign all necessary documents, and lender consents and subordination agreements must be in place. These stipulations are designed to protect the Bevaris Alliance brand and ensure the financial stability and operational integrity of the franchise network.
Furthermore, Bevaris Alliance has the right of first refusal to acquire the franchisee's business. This means that Bevaris Alliance can match any offer made for the purchase of a franchise. Bevaris Alliance also has the option to purchase the business upon transfer at fair market value, excluding any value for goodwill, ensuring legal compliance, and without assuming the franchisee's liabilities. In the event of the death or disability of a franchisee, the franchise may be assigned by the estate to an approved transferee within three months.
These transfer provisions are typical in franchising, as franchisors seek to maintain standards and protect their brand. Prospective Bevaris Alliance franchisees should carefully review Section 16.11 of the Franchise Agreement, as referenced in the FDD, to fully understand the requirements and implications of transferring their franchise.