Who appoints the appraiser if Alloy and the franchisee cannot agree?
Alloy Franchise · 2025 FDDAnswer from 2025 FDD Document
B. Purchase Option. We have the right to purchase or designate a third party that will purchase all or any portion of the assets of your Facility that are owned by you or any of your affiliates including, without limitation, the premises, building, equipment, fixtures, signage, furnishings, supplies, leasehold improvements, and inventory of the Facility at a price determined by a qualified appraiser (or qualified appraisers if one party believes it is better to have a real estate appraiser appraise the value of the land and building and a business appraiser appraise the Facility's other assets) selected with the consent of both parties, provided we give you written notice of our preliminary intent to exercise our purchase rights under this Paragraph within 30 days after the date of the expiration or termination of this Agreement, or the expiration of any Interim Period. If the parties cannot agree upon the selection of an appraiser(s), one or both will be appointed by a Judge of the United States District Court for the District in which the Facility is located upon petition of either party.
Source: Item 23 — RECEIPTS (FDD pages 69–245)
What This Means (2025 FDD)
According to Alloy's 2025 Franchise Disclosure Document, if Alloy exercises its right to purchase a franchisee's assets upon termination or expiration of the franchise agreement, the price will be determined by a qualified appraiser. The appraiser is selected with the consent of both Alloy and the franchisee.
However, if Alloy and the franchisee cannot agree on an appraiser, the document specifies that a Judge of the United States District Court for the district in which the Alloy facility is located will appoint one or both appraisers. This appointment occurs upon petition by either Alloy or the franchisee.
This process ensures that an unbiased third party determines the fair market value of the assets. It also provides a legal recourse if the franchisee and Alloy cannot come to a mutual agreement on the appraiser, which protects both parties' interests during the purchase option execution.