Under what circumstances is Bumble Roofing entitled to exercise its rights regarding the purchase of the franchisee's business?
Bumble_Roofing Franchise · 2025 FDDAnswer from 2025 FDD Document
PTION TO PURCHASE RIGHT OF FIRST REFUSAL**
- 16.1 Unless otherwise explicitly provided by this Agreement, Franchisor shall be entitled to exercise the rights provided in this Section immediately upon:
- (a) The expiration without the extension of Franchisee's rights to operate the Roofing Business or the termination for any reason of the License or this Agreement; or
- (b) The receipt by Franchisor of a copy of a Purchase Offer.
- (a) The expiration without the extension of Franchisee's rights to operate the Roofing Business or the termination for any reason of the License or this Agreement; or
- 16.2 Upon any event described in this Section 16.2, Franchisor shall have the option to purchase all of Franchisee's rights, title and interest in the Business, and all its improvements, furniture, fixtures, equipment and products, and all of Franchisee's accounts, contract rights, customer and vendor lists, work in progress and other business assets.
- 16.3 The purchase price for assets itemized in Section 16.2 will be, subject to Section 16.4: (i) the current fair market value if Section 16.1(a) is applicable; or (ii) the price specified in the Purchase Offer received by Franchisee if Section 16.1(b) is applicable. If Franchisee and Franchisor cannot agree on fair market value within a reasonable time, an independent appraiser will be designated by each of Franchisee and Franchisor and an average of the 2 appraised values will be binding. Appraised values will exclude any and all consideration for goodwill or going concern value created by the Marks and business system licensed to Franchisee.
Source: Item 22 — CONTRACTS (FDD page 53)
What This Means (2025 FDD)
According to Bumble Roofing's 2025 Franchise Disclosure Document, Bumble Roofing has the option to purchase the franchisee's business under two specific circumstances. First, Bumble Roofing can exercise this option if the franchisee's rights to operate the Roofing Business expire without an extension, or if the License or the Franchise Agreement is terminated for any reason. Second, Bumble Roofing can exercise its option to purchase the business upon receiving a copy of a purchase offer made to the franchisee by a third party.
If either of these events occurs, Bumble Roofing has the option to purchase all of the franchisee's rights, title, and interest in the business. This includes all improvements, furniture, fixtures, equipment, products, accounts, contract rights, customer and vendor lists, work in progress, and other business assets.
The purchase price will be determined based on the circumstances. If the purchase is triggered by the expiration or termination of the agreement, the price will be the current fair market value of the assets. If the purchase is triggered by a third-party purchase offer, the price will be the price specified in that offer. However, the appraised value will exclude any consideration for goodwill or the value created by the Bumble Roofing marks and business system. Bumble Roofing must notify the franchisee of its intent to purchase the business within 60 days of the expiration or termination event, or within 15 days of receiving the purchase offer.