If Augusta Lawn Care terminates my franchise, does Augusta Lawn Care have the option to purchase my business?
Augusta_Lawn_Care Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in | Summary | |
|---|---|---|---|
| Franchise Agreement | |||
| a. Length of the franchise term | Section 4.5.1 | Ten (10) years from the Effective Date of the Franchise Agreement. | |
| b. Renewal or extension of the term | Section 4.5.2 | If you are in good standing, and have met the conditions set forth in row (c), below, you have the right to renew the Franchise Agreement for one (1) successive ten (10) year term with payment of any franchise renewal fee that is in effect at the time of renewal. The current renewal fee is $0. | |
| c. Requirements for you to renew or extend | Section 4.5.2 | Good standing; timely advance notice; pay any then-current renewal fee; sign new franchise agreement that may contain materially different terms and conditions than the Franchise Agreement in this Disclosure Document; be current in payments; sign release. | |
| d. Termination by you | Not Applicable | You may terminate under any grounds permitted by law. | |
| e. Termination by us without cause | Not Applicable | ||
| f. Termination by us with cause | Section 10.2 | We can terminate only if you default. | |
| g. “Cause” defined – curable defaults | Section 10.2.2 | You have 30 days to cure noticed curable defaults other than for non- payment of fees. You have five (5) days to cure non-payment of fees. | |
| o. Our option to purchase your business | Section 9.4 | We or our designee may, but are not required to, purchase your inventory and equipment at the lesser of the fair market value or depreciated value, if franchise is terminated for any reason. |
Source: Item 19 — FINANCIAL PERFORMANCE REPRESENTATIONS (FDD pages 35–38)
What This Means (2025 FDD)
According to Augusta Lawn Care's 2025 Franchise Disclosure Document, Augusta Lawn Care has the option, but not the obligation, to purchase a franchisee's business if the franchise is terminated for any reason. Specifically, Augusta Lawn Care or its designee may purchase the franchisee's inventory and equipment.
The purchase price will be the lesser of the fair market value or the depreciated value of the inventory and equipment. This means a franchisee might not receive the full market value for their assets if the depreciated value is lower.
This clause protects Augusta Lawn Care by allowing them to reacquire assets if a franchise is terminated, potentially to maintain operations or resell the assets to a new franchisee. For a prospective franchisee, it is important to understand how the fair market value and depreciated value of assets will be determined in the event of termination, and to consider this potential outcome when making the initial investment in inventory and equipment.