How is the purchase price for my Petro Stopping Center determined if Petro Stopping Center exercises its purchase option?
Petro_Stopping_Center Franchise · 2025 FDDAnswer from 2025 FDD Document
to assign this option to purchase your Petro Center. We will be entitled to all customary warranties and representations in connection with our asset purchase, including, without limitation, representations and warranties as to ownership and condition of and title to assets; liens and encumbrances on assets; validity of contracts and agreements; and liabilities affecting the assets, contingent or otherwise.
- (b) Leasehold Rights. If we exercise the option to purchase your Petro Center as described above, then you agree at our election:
- (i) to assign your leasehold interest in the Site to us (for no additional consideration and at no additional cost to us); or
- (ii) to enter into a sublease for the remainder of the lease term on the same terms (including renewal options) as the prime lease (at no additional cost to us).
- (c) Purchase Price. The purchase price for your Petro Center under this Section will be the fair market value ("Fair Market Value") of the Petro Center exclusive of any goodwill, determined in a manner consistent with reasonable depreciation of the Petro Center's equipment, signs, inventory, materials and supplies, provided that the Petro Center will be valued as an independent business and its value will not include any value for:
- (i) the Franchise or any rights granted by this Agreement;
- (ii) the Marks or Copyrights; or
- (iii) participation in the System.
We may exclude from the assets purchased cash or its equivalent and any Operating Assets, such as equipment, signs, inventory, materials and supplies that are not reasonably necessary (in function or quality) to the Petro Center's operation or that we have not approved as meeting standards for Petro Centers, and the purchase price will reflect such exclusions.
- (d) Appraisal. If we and you are unable to agree on the Fair Market Value of your Petro Center within ten (10) days of the Notification Date, the Fair Market Value will be determined by an independent appraiser selected by both you and us within ten (10) days of our collective inability to timely agree on the Fair Market Value. If we cannot timely agree on an independent appraiser, then such appraiser will be selected as follows. Within five (5) days of our inability to agree on an independent appraiser, we will choose a certified public accounting firm and you will choose a certified public accounting firm. Those two firms shall, within ten (10) days, select a mutually acceptable appraisal firm (the "Appraiser") to make the independent appraisal, in accordance with this Agreement. The Appraiser shall have at least ten (10) years' experience valuing properties similar to the Petro Center and the individual responsible for valuing real estate shall be a Member Appraisal Institute (MAI) appraiser. You and we shall each bear one-half of the costs of the Appraiser.
- (e) Due Diligence. For a period of thirty (30) days following our receipt of the Appraiser's determination of value, we have the right to conduct a due diligence investigation (the "Due Diligence Period") of your franchise, the Operating Assets, and all of your rights, liabilities and obligations.
Source: Item 17 — RENEWAL TERMS. (FDD pages 208–228)
What This Means (2025 FDD)
According to the 2025 Petro Stopping Center Franchise Disclosure Document, if Petro Stopping Center exercises its option to purchase your Petro Center, the purchase price will be the fair market value of the Petro Center, excluding any goodwill. The fair market value will be determined in a manner consistent with reasonable depreciation of the Petro Center's equipment, signs, inventory, materials, and supplies. The Petro Center will be valued as an independent business, without including any value for the franchise itself, the trademarks or copyrights, or participation in the Petro Stopping Center system.
If you and Petro Stopping Center cannot agree on the fair market value within ten days of the notification date (the date Petro Stopping Center notifies you of their decision to exercise the purchase option), an independent appraiser will determine the value. Both you and Petro Stopping Center must agree on the selection of this appraiser within ten days of your collective inability to agree on the fair market value. If you cannot agree on an independent appraiser, each party will choose a certified public accounting firm, and those two firms will then select a mutually acceptable appraisal firm to conduct the independent appraisal. The selected appraiser must have at least ten years of experience valuing similar properties, and the individual valuing the real estate must be a Member Appraisal Institute (MAI) appraiser. The costs of the appraiser will be split equally between you and Petro Stopping Center.
Following the appraiser's determination of value, Petro Stopping Center has a 30-day due diligence period to investigate your franchise, operating assets, and all associated rights, liabilities, and obligations. During this period, you must provide reasonable access to your facilities, books, and records, and cooperate with Petro Stopping Center to make yourself and necessary third parties available. Petro Stopping Center has the right to withdraw their offer to purchase your Petro Center if the results of their due diligence are unsatisfactory or if they are not satisfied with the appraiser's opinion of value, at their sole discretion. The purchase price will be paid in cash at closing, which must occur no later than 30 days after the expiration of the due diligence period.