What is the definition of 'Assets' in the Pump It Up franchise agreement?
Pump_It_Up Franchise · 2025 FDDAnswer from 2025 FDD Document
A. Scope. Upon the expiration or termination of this Agreement for any reason, we will provide written notice to you, within 30 days after the effective date of termination or expiration, if we intend to exercise our option to purchase from you some or all of the assets used in the Franchised Business (the "Assets"). As used in this Section 21, the term "Assets" means and includes, without limitation, leasehold improvements, equipment, vehicles, furnishings, fixtures, signs and inventory (non-perishable products, materials and supplies) used in the Franchised Business, real estate interests (including the fee simple rights or the Lease), and any licenses necessary to operate the Franchised Business. We have the unrestricted right to assign this option to purchase the Assets. We or our assignee will be entitled to all customary representations and warranties that the Assets are free and clear (or, if not, accurate and complete disclosure) as to: (1) ownership, condition and title; (2) liens and encumbrances; (3) environmental and hazardous substances; and (4) validity of contracts and liabilities inuring to us or affecting the Assets, whether contingent or otherwise.
- B. Purchase Price. The purchase price for the Assets ("Purchase Price") will be the fair market value of the Assets (or, for leased assets, the fair market value of your Lease), determined as of the effective date of purchase in a manner that accounts for customary depreciation and condition of the Assets; provided, however, that the Purchase Price will take into account the termination of this Agreement. Further, the Purchase Price for the Assets will not contain any factor or increment for any trademark, service mark or other commercial symbol used in connection with the operation of the Franchised Business nor any goodwill or "going concern" value for the Franchised Business. We may exclude from the Assets purchased in accordance with this Section any equipment, vehicles, furnishings, fixtures, signs, and
inventory that are not approved as meeting then-current standards for a Pump It Up Business or for which you cannot deliver a Bill of Sale in a form satisfactory to us.
Source: Item 23 — RECEIPTS (FDD pages 60–225)
What This Means (2025 FDD)
According to the 2025 Pump It Up Franchise Disclosure Document, the term "Assets" refers to the items that Pump It Up has the option to purchase from the franchisee upon the expiration or termination of the franchise agreement. Pump It Up must provide written notice to the franchisee within 30 days after the effective date of termination or expiration if they intend to exercise this option.
The assets that Pump It Up may purchase include leasehold improvements, equipment, vehicles, furnishings, fixtures, signs, and inventory consisting of non-perishable products, materials, and supplies used in the franchised business. It also extends to real estate interests, encompassing both fee simple rights and the lease itself, as well as any licenses necessary to operate the Pump It Up franchised business.
Pump It Up has the right to assign this purchase option to another party. The purchase price for these assets will be based on their fair market value at the time of purchase, taking into account customary depreciation and the condition of the assets. However, the purchase price will not include any value associated with the Pump It Up trademark, service mark, or other commercial symbols, nor will it include any goodwill or "going concern" value of the franchised business. Pump It Up also reserves the right to exclude any assets that do not meet the then-current standards for a Pump It Up business or for which the franchisee cannot provide a satisfactory bill of sale.