Who bears the cost of the inventory conducted after termination or expiration of a Canine Dimensions franchise?
Canine_Dimensions Franchise · 2025 FDDAnswer from 2025 FDD Document
Within fifteen (15) days from the date of termination or expiration, Franchisee and Franchisor shall arrange for an inventory to be made, at Franchisor's cost, of all personal property, fixtures, equipment, and inventory of Franchisee, including, without limitation, any and all items bearing the Marks, related to the operation of the Franchised Business. Franchisor will have the option, to be exercised within thirty (30) days after termination or expiration, to purchase from Franchisee any and all such items at fair market value. If the parties cannot agree on fair market value within a reasonable time, an independent appraiser shall be designated by Franchisor, and his determination will be binding. If Franchisor elects to exercise any option to purchase herein provided, it shall have the right to set off all amounts due from Franchisee under this Agreement, and the cost of the appraisal, if any, against any payment therefor.
Source: Item 22 — CONTRACTS (FDD page 36)
What This Means (2025 FDD)
According to Canine Dimensions' 2025 Franchise Disclosure Document, the franchisor bears the cost of the inventory conducted after the termination or expiration of the franchise agreement. Within fifteen days of termination or expiration, the franchisee and Canine Dimensions must arrange for an inventory of all personal property, fixtures, equipment, and inventory related to the franchise's operation, including items bearing the Canine Dimensions marks.
Canine Dimensions has the option to purchase these items from the franchisee at fair market value, which must be exercised within thirty days after termination or expiration. If both parties cannot agree on the fair market value, an independent appraiser designated by Canine Dimensions will determine the value, and this determination will be binding.
If Canine Dimensions chooses to purchase the items, it can offset any amounts owed by the franchisee under the agreement, as well as the cost of the appraisal, against the payment for the purchased items. This arrangement ensures that the franchisee is not responsible for the inventory costs associated with the termination or expiration of the franchise agreement, while also providing Canine Dimensions with the option to repurchase assets related to the business.