Does Bft have the option to purchase the assets of a terminated franchisee's Studio?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
To the extent, this Section 15.3(I) is inconsistent with RCW 19.100.180(2)(i), it is hereby deemed modified to comply with RCW 19.100.180(2)(i). Subject to applicable laws, Franchisor is required to purchase certain assets at fair market value (including goodwill in certain instances) at the time of expiration or termination of the franchise, offset by any amounts owed by the Franchisee to the Franchisor.
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 57–66)
What This Means (2025 FDD)
According to Bft's 2025 Franchise Disclosure Document, Bft may be required to purchase certain assets of a terminated or expired franchise. Specifically, Bft is required to purchase certain assets at fair market value, which may include goodwill in some instances. This purchase is subject to applicable laws and will be offset by any amounts the franchisee owes to Bft.
This means that if a Bft franchise is terminated or expires, Bft may be obligated to buy certain assets from the franchisee. The price Bft pays will be the fair market value of the assets at the time of termination or expiration, potentially including an assessment of goodwill. However, any debts the franchisee owes to Bft will be deducted from this purchase price.
This clause is modified to comply with RCW 19.100.180(2)(i), the Revised Code of Washington concerning franchises. This suggests that the standard franchise agreement might have terms that conflict with Washington state law, and this modification ensures compliance within Washington. Prospective franchisees should carefully review Section 15.3(I) of the Franchise Agreement and any state-specific addenda to fully understand their rights and obligations regarding asset repurchase upon termination or expiration, and how local laws might impact the process.