To whom must a Canopy Lawn Care franchisee submit a copy of the Purchase Offer when selling the business?
Canopy_Lawn_Care Franchise · 2025 FDDAnswer from 2025 FDD Document
- 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 Lawn Care 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 Lawn Care 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.
- 16.4 If Franchisor elects to exercise any option to purchase provided in this Section 16 Franchisor will have the right to set off all amounts due from Franchisee under this Agreement or any other agreements between the parties, any commissions or fees payable to any broker, agent or other intermediary and the cost of the appraisal, if any, against any payment. Franchisee shall also have the right to substitute cash for any other form of consideration specified in the Purchase Offer and to pay in full the entire purchase price at the time of closing.
Source: Item 22 — CONTRACTS (FDD page 55)
What This Means (2025 FDD)
According to Canopy Lawn Care's 2025 Franchise Disclosure Document, if a franchisee receives a Purchase Offer for their business, they must provide a copy of it to the Franchisor. This requirement triggers Canopy Lawn Care's right of first refusal, giving them the option to purchase the franchisee's business.
Specifically, upon receiving the Purchase Offer, Canopy Lawn Care 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 the price specified in the Purchase Offer received by the franchisee. However, if Canopy Lawn Care chooses to exercise its purchase option, it has the right to offset any amounts due from the franchisee under the Franchise Agreement or any other agreements, as well as any commissions or fees payable to brokers or agents, and the cost of any appraisal against the purchase price. The franchisee also has the right to substitute cash for any other form of consideration specified in the Purchase Offer and pay the entire purchase price in cash at closing.