Under what circumstances does All Team have the right to purchase the franchisee's personal property?
All_Team Franchise · 2025 FDDAnswer from 2025 FDD Document
D. ATFC's Right to Purchase Personal Property. After the termination or expiration of this Agreement, but not upon an approved Transfer, ATFC shall have the right, but not the obligation, to purchase all of FRANCHISEE's equipment, inventory, supplies and other personal property used in connection with the operation of the business. Notwithstanding the foregoing, FRANCHISEE has the right to keep any and all personal effects and furnishings of sentimental value to FRANCHISEE, which FRANCHISEE elects to exclude. The purchase price shall be at fair market value (less the amount of any liens on the property), which shall be established (if the parties are unable to agree) by the average of two independent appraisals. FRANCHISEE and ATFC shall each select an independent appraiser within thirty (30) days after termination or expiration of this Agreement. If either party fails to select an appraiser within such time period, the appraised value shall be determined by the one appraiser selected. ATFC shall have thirty (30) days after the fair market value is determined as above, to exercise the rights granted hereunder, and shall thereafter have an additional thirty (30) days to pay for the property it desires to purchase.
Source: Item 22 — CONTRACTS (FDD pages 33–34)
What This Means (2025 FDD)
According to All Team's 2025 Franchise Disclosure Document, after the termination or expiration of the Franchise Agreement, All Team has the right, but not the obligation, to purchase the franchisee's equipment, inventory, supplies, and other personal property used in connection with the operation of the business. The franchisee can keep personal effects and furnishings of sentimental value. This does not apply upon an approved transfer of the franchise.
The purchase price will be the fair market value of the property, less any liens on it. If All Team and the franchisee cannot agree on the fair market value, it will be determined by the average of two independent appraisals. The franchisee and All Team will each select an independent appraiser within 30 days after the termination or expiration of the Franchise Agreement. If either party fails to select an appraiser within that time, the value will be determined by the one appraiser selected.
All Team has 30 days after the fair market value is determined to exercise its right to purchase the property and an additional 30 days to pay for the property it desires to purchase. This clause ensures that upon the end of the franchise relationship, All Team has the option to maintain control over the assets used in the business, while also providing a mechanism for fair compensation to the franchisee for those assets.