Under what circumstances can the initial term of a Bevaris Alliance franchise agreement be terminated early?
Bevaris_Alliance Franchise · 2024 FDDAnswer from 2024 FDD Document
3. Commencement Date and Term
- 3.1 Initial Term. The Initial Term of the agreement is 5 years from the Commencement Date subject to earlier termination in accordance with clause 18.
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 Franchis
Source: Item 23 — RECEIPT (FDD pages 22–88)
What This Means (2024 FDD)
According to the 2024 Bevaris Alliance Franchise Disclosure Document, the initial term of the franchise agreement is five years but can be terminated earlier under certain conditions as outlined in clause 18 of the agreement.
The Bevaris Alliance franchise agreement can be terminated by the Franchisor with immediate effect if the Franchisee or Individual fails to pay any amount due under the agreement by the due date and remains in default for at least seven days after receiving written notice. Additionally, Bevaris Alliance can terminate the agreement if the Franchisee or Individual commits a material breach of any term within the agreement, the manual, or any other written agreement between the Franchisor and Franchisee. If the breach is remediable, the Franchisee has 14 days after written notification to remedy the breach or adequately assist Bevaris Alliance in remedying a Food Service Agreement.
These termination clauses are typical in franchise agreements to protect the franchisor's brand and ensure compliance with the franchise system. A prospective Bevaris Alliance franchisee should carefully review clause 18 of the franchise agreement to fully understand the conditions that could lead to early termination and the potential consequences.