How is the purchase price of the Bens Soft Pretzels store assets determined after termination?
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.
Within 30 days after our receipt of the appraisal report, we or our designated purchaser will identify the assets, if any, that we intend to purchase at the price designated for those assets in the appraisal report. We or our designated purchaser and you will then proceed to complete and close the purchase of the identified assets, and to prepare and execute purchase and sale documents customary for the assets being purchased, in a commercially reasonable time and manner. We and you will each pay one-half of the appraiser's fees and expenses.
Source: Item 22 — CONTRACTS (FDD pages 46–47)
What This Means (2025 FDD)
According to the 2025 Bens Soft Pretzels Franchise Disclosure Document, Bens Soft Pretzels has the option to purchase the assets of a franchisee's store after the termination or expiration of the franchise agreement. This includes assets owned by the franchisee or their affiliates, such as land, buildings, equipment, fixtures, signage, furnishings, supplies, leasehold improvements, and inventory. Bens Soft Pretzels must provide written notice of their intent to purchase these assets within 30 days of the agreement's expiration or termination.
The purchase price for these assets is determined by a qualified appraiser selected with the consent of both Bens Soft Pretzels and the franchisee. If both parties cannot agree on an appraiser, a judge from the United States District Court in the district where the store is located will appoint one. If one party prefers to have a real estate appraiser value the land and building and a business appraiser value the store's other assets, they may do so.
The appraiser will determine the reasonable fair market value of the assets based on their continued use as a Bens Soft Pretzels store, designating a price for each asset category (e.g., land, building, equipment, fixtures). However, the appraisal will not include the value of the business's goodwill, as this is attributed to the Bens Soft Pretzels trademarks and system. Within 30 days of receiving the appraisal report, Bens Soft Pretzels will identify which assets they intend to purchase at the prices specified in the report. Both Bens Soft Pretzels and the franchisee will then proceed to complete the purchase, executing customary purchase and sale documents. The fees and expenses of the appraiser will be split equally between Bens Soft Pretzels and the franchisee.