What actions must an All Team franchisee take to renew the franchise agreement?
All_Team Franchise · 2025 FDDAnswer from 2025 FDD Document
The term of this Agreement shall be for a period of ten (10) years from the date of execution, unless sooner terminated in accordance with this Agreement. If FRANCHISEE is in full compliance with the terms of this Agreement, FRANCHISEE shall have the right to renew for two additional terms of ten (10) years, provided that FRANCHISEE is not in default under this Agreement at the time of renewal and agrees to execute the most current franchise agreement being utilized by ATFC. The most current franchise agreement may contain significantly different terms than this Agreement. Notwithstanding the foregoing, ATFC may, in its discretion, refuse to renew the Franchise if FRANCHISEE has been notified of defaults (even if subsequently cured) under this Agreement more than three (3) times during the initial term or more than three (3) times during any renewal term, even if FRANCHISEE is not in default at the time of such renewal. FRANCHISEE agrees to give ATFC not less than six (6) or more than eighteen (18) months written notice of an election to renew the franchise, prior to the end of the initial term or the renewal term. Failure to give such notice shall be an election not to renew the franchise. FRANCHISEE shall also pay ATFC a renewal fee of 25% of the then current Franchise Fee, remodel the Agency to current standards and execute a general release, to the extent permitted by applicable law, of any and all claims against ATFC and its affiliates and their respective shareholders, officers, directors, employees, agents, successors and assigns arising under or from this Agreement and any related agreement between the parties or under any applicable law, rule or regulation.
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 28–30)
What This Means (2025 FDD)
According to All Team's 2025 Franchise Disclosure Document, a franchisee has the right to renew their franchise agreement for two additional terms of ten years each, provided they meet certain conditions. To renew, the franchisee must not be in default under the existing agreement at the time of renewal and must agree to execute the most current franchise agreement being utilized by All Team, which may contain significantly different terms than the original agreement.
Specifically, the franchisee must provide written notice to All Team not less than six months, but not more than eighteen months, before the end of the current term, indicating their intent to renew. Failure to provide this notice constitutes an election not to renew the franchise. Additionally, the franchisee must pay All Team a renewal fee equal to 25% of the then-current franchise fee.
Furthermore, the franchisee is required to remodel the agency to meet All Team's current standards and execute a general release, to the extent permitted by applicable law, of any and all claims against All Team and its affiliates. It's important to note that All Team retains the discretion to refuse renewal if the franchisee has been notified of defaults more than three times during the initial term or any renewal term, even if these defaults were subsequently cured and the franchisee is not in default at the time of renewal. This highlights the importance of maintaining consistent compliance with the franchise agreement to ensure renewal eligibility.