How many days does Pump It Up have to close on the purchase of an interest after electing to purchase it?
Pump_It_Up Franchise · 2025 FDDAnswer from 2025 FDD Document
(1) We have the right, exercisable within 10 days after receipt of the notice specified in Section 16.B(1), to send written notice to you that we intend to purchase the interest proposed
to be transferred. We may assign our right of first refusal to someone else either before or after we exercise it. Our right of first refusal will not apply to Transfers for Convenience of Ownership under Section 16.C. If the proposed Transfer is to be made pursuant to a sale, we or our designee may purchase the interest proposed to be transferred on the same economic terms and conditions offered by the third party. Closing on our purchase must occur within 60 days after the date of our notice to the seller electing to purchase the interest. If we cannot reasonably be expected to furnish the same consideration as the third party, then we may substitute the reasonable equivalent in cash. If, within 30 days, the parties cannot agree on the reasonable equivalent in cash, we will designate, at our expense, an independent appraiser, and the appraiser's determination of the value of the interest being sold will be final. Any material changes in the terms of the offer from a third party after we have elected not to purchase the seller's interest will constitute a new offer, subject to the same right of first refusal as the third party's initial offer.
- (2) If the proposed Transfer is to be made by gift, and our right of first refusal applies to such a transfer, we will designate, at our expense, an independent appraiser to determine the fair market value of the interest proposed to be transferred.
We may purchase the interest at the fair market value determined by the appraiser.
Closing on the purchase will occur within 30 days after our notice to the transferor of the appraiser's determination of fair market value.
Source: Item 23 — RECEIPTS (FDD pages 60–225)
What This Means (2025 FDD)
According to Pump It Up's 2025 Franchise Disclosure Document, the closing on the purchase of an interest will occur within 30 days after Pump It Up gives notice to the transferor of the appraiser's determination of fair market value. This applies when the proposed transfer is made by gift and Pump It Up's right of first refusal is applicable. In this scenario, Pump It Up will designate an independent appraiser to determine the fair market value of the interest proposed to be transferred and may then purchase the interest at that appraised value.
However, if the proposed transfer is to be made pursuant to a sale, Pump It Up has a different timeline. Pump It Up has the right to send written notice within 10 days of receiving notice of the proposed transfer that they intend to purchase the interest. If Pump It Up exercises this right, the closing on their purchase must occur within 60 days after the date of their notice to the seller electing to purchase the interest.
These timelines are important for a prospective franchisee to understand, as they dictate the speed at which a potential sale of their franchise can occur if Pump It Up decides to exercise its right of first refusal. The distinction between a transfer by gift versus a sale is also critical, as it affects the appraisal process and the overall closing timeline.