How long does Cinnaholic have to exercise its right to purchase the Assets after being advised of the appraisers' decision?
Cinnaholic Franchise · 2025 FDDAnswer from 2025 FDD Document
If Franchisor desires to purchase the Assets but the parties are unable to agree as to a purchase price and terms of such sale, the fair market value of the Assets (to be determined without goodwill or going concern value) shall be determined by three appraisers. Franchisee and Franchisor shall each select one appraiser, and the two appraisers so chosen shall select the third appraiser. The three appraisals shall be averaged to determine the purchase price. Franchisor shall have the right, at any time within 15 days after being advised in writing of the decision of the appraisers as aforesaid, to purchase the Assets at the purchase price as determined above. Each party shall be responsible for the costs and expenses of the appraiser it selected and the cost of the third appraiser shall be shared equally by the parties. Nothing contained in this Section shall be deemed to be a waiver by Franchisor of any default by Franchisee under this Agreement nor shall the exercise of the option to purchase the Assets contained in this Section affect any other rights or remedies granted to Franchisor hereunder or otherwise available to it.
Source: Item 22 — CONTRACTS (FDD pages 61–62)
What This Means (2025 FDD)
According to Cinnaholic's 2025 Franchise Disclosure Document, if the franchise agreement expires or is terminated, Cinnaholic has the option to purchase the bakery's assets. If Cinnaholic and the franchisee cannot agree on a purchase price, three appraisers will determine the fair market value of the assets, excluding goodwill or going concern value. Each party selects one appraiser, and those two appraisers select a third. The purchase price is the average of the three appraisals.
Cinnaholic has 15 days after receiving written notice of the appraisers' decision to exercise its right to purchase the assets at the determined purchase price. Each party is responsible for the costs of their chosen appraiser, and they split the cost of the third appraiser.
This clause does not waive Cinnaholic's right to address any franchisee defaults, nor does exercising the purchase option affect any other rights or remedies available to Cinnaholic. This is a fairly standard clause in franchise agreements to protect the brand and ensure a smooth transition if a franchise closes.