What representations and warranties is Pump It Up or its assignee entitled to when purchasing assets from a Pump It Up franchisee?

According to the 2025 Pump It Up Franchise Disclosure Document, if Pump It Up exercises its option to purchase assets from a franchisee upon termination or expiration of the franchise agreement, Pump It Up or its assignee is entitled to certain representations and warranties. These assurances relate to the condition and ownership of the assets being acquired.

Specifically, Pump It Up or its assignee is entitled to customary representations and warranties that the assets are free and clear, or with accurate and complete disclosure, regarding several key aspects. These include: ownership, condition, and title of the assets; any existing liens and encumbrances affecting the assets; any environmental and hazardous substances associated with the assets; and the validity of contracts and liabilities that would transfer to Pump It Up or affect the assets, whether these liabilities are immediate or potential.

This means that a franchisee selling assets back to Pump It Up must provide full transparency and guarantees about the state of the assets. This protects Pump It Up from inheriting hidden problems or liabilities. For a prospective franchisee, this highlights the importance of maintaining assets properly and keeping accurate records, as these factors will be scrutinized if Pump It Up chooses to buy back the business.