What happens if the sale price of the transferred Apricot Lane franchise is financed?

According to Apricot Lane's 2025 Franchise Disclosure Document, if any part of the sale price of the transferred interest is financed, the transferor must agree that all obligations of the transferee under any promissory note, agreements, or security interests related to the assets of the franchised business or premises are subordinate to the transferee's obligations to pay fees and other amounts due to Apricot Lane and its affiliates.

In simpler terms, if a new Apricot Lane franchisee finances the purchase of an existing franchise, the seller's financial claim on the business assets takes a backseat to Apricot Lane's right to receive its franchise fees and other payments. This means that if the new franchisee runs into financial difficulties and cannot pay all their debts, Apricot Lane will be paid before the seller receives any money from the assets of the business.

This provision protects Apricot Lane by ensuring that its revenue stream is not jeopardized by financing arrangements between the buyer and seller of a franchise. It also aligns with standard franchising practices, where the franchisor's ongoing fees are prioritized to maintain the health and stability of the franchise system. Prospective franchisees should be aware of this condition when considering financing options for purchasing an existing Apricot Lane franchise.