What assets can Bens Soft Pretzels purchase when exercising its option to purchase a franchisee's business?
Bens_Soft_Pretzels 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 Store that are owned by you or any of your affiliates including, without limitation, the land, building, equipment, fixtures, signage, furnishings, supplies, leasehold improvements, and inventory of the Store 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 Store'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 Store is located upon petition of either party.
The price determined by the appraiser(s) will be the reasonable fair market value of the assets based on their continuing use in, as, and for the operation of a BEN'S SOFT PRETZELS Store and the appraiser will designate a price for each category of asset (e.g., land, building, equipment, fixtures, etc.), but shall not include the value of any goodwill of the business, as the goodwill of the business is attributable to the Trademarks and the System.
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION (FDD pages 34–37)
What This Means (2025 FDD)
According to Bens Soft Pretzels' 2025 Franchise Disclosure Document, Bens Soft Pretzels has the option to purchase specific assets of a franchisee's store. These assets can include the land, building, equipment, fixtures, signage, furnishings, supplies, leasehold improvements, and inventory. This purchase option allows Bens Soft Pretzels to maintain control and consistency within its franchise system.
The purchase price for these assets will be determined by a qualified appraiser, or appraisers, selected with the consent of both parties. The FDD specifies that if both parties cannot agree on an appraiser, a judge of the United States District Court for the district in which the store is located will appoint one or both appraisers upon petition of either party. The appraiser will determine the reasonable fair market value of the assets based on their continuing use in the operation of a Bens Soft Pretzels store.
It is important to note that the appraisal will designate a price for each category of asset, such as land, building, equipment, and fixtures. However, the appraisal will not include the value of any goodwill of the business, as the goodwill is attributable to the trademarks and the Bens Soft Pretzels system. Bens Soft Pretzels must provide written notice of their intent to exercise the purchase option within 30 days after the expiration or termination of the Franchise Agreement or any Interim Period.