How is the purchase price for the Assets determined if Angry Chickz exercises its purchase option?
Angry_Chickz Franchise · 2025 FDDAnswer from 2025 FDD Document
15.3.3 The purchase price for the Assets shall be fair market value of the Assets (except actual cost for useable, unopened inventory and supplies); Company shall have the right to set off from the purchase price all amounts due from Franchisee to Company under this Agreement as well as any other amounts due to Company's Affiliates; in the event Company and Franchisee do not agree on the fair market value of the Assets within three (3) business days of Company's written offer to Franchisee, they shall each appoint (within ten (10) business days of Company's initial offer) an appraiser experienced in used foodservice equipment transactions to appraise the Assets within one week of appointment, both appraisals shall be provided to Company and to Franchisee to further attempt to agree on the fair market value; if Company and Franchisee are unable to agree on fair market value of the Assets within two (2) business days of such discussion, then Company shall have the option of either: (i) paying the average of the two appraisals and
proceeding with the purchase (leaving Franchisee the option to bring a claim in arbitration for any difference between fair market value as determined by the arbitrator and what Company has then paid for the Assets, which might result in the arbitrator determining that Company paid more than fair market value and would be entitled to a partial refund); or (ii) canceling the exercise of Company's purchase of the Assets;
Source: Item 22 — CONTRACTS (FDD page 54)
What This Means (2025 FDD)
According to Angry Chickz's 2025 Franchise Disclosure Document, the purchase price for the assets will be the fair market value of the assets, except for usable, unopened inventory and supplies, which will be purchased at actual cost. Angry Chickz has the right to deduct any amounts the franchisee owes them from the purchase price, including amounts owed to their affiliates.
If Angry Chickz and the franchisee cannot agree on the fair market value of the assets within three business days of Angry Chickz's written offer, both parties must appoint an appraiser experienced in used foodservice equipment transactions within ten business days of the initial offer. These appraisers will then appraise the assets within one week of their appointment, and both appraisals will be provided to Angry Chickz and the franchisee to facilitate further attempts to agree on the fair market value.
If an agreement still cannot be reached within two business days of discussing the appraisals, Angry Chickz has the option to either pay the average of the two appraisals and proceed with the purchase, or cancel the purchase. If Angry Chickz pays the average of the appraisals, the franchisee retains the right to bring a claim in arbitration for any difference between the fair market value determined by the arbitrator and what Angry Chickz has already paid. This arbitration could result in a determination that Angry Chickz overpaid and is entitled to a partial refund.