Must an Alloy franchisee comply with remodeling and modernization requirements to renew?
Alloy Franchise · 2025 FDDAnswer from 2025 FDD Document
15.P below and the Data Sheet and ends 10 years from the date of this Agreement, subject to any modifications in the Data Sheet to take into account the term of the lease for your Authorized Location.
- B. Renewal. You will have the option to renew your rights under this Agreement for one (1) renewal term of 10 years. We may grant you the option to enter into a renewal agreement for your Facility provided that with respect to the renewal agreement: (i) you have given us written notice of your intent to enter into a renewal agreement at least 6 months but not more than 12 months prior to the end of the expiring term; (ii) you sign our then-current form of franchise agreement (modified to reflect that the agreement relates to a renewal agreement), the terms of which may differ from this Agreement, including higher fees; (iii) you have complied with the provisions of subparagraph 5.E regarding modernization and you perform any further items of modernization and/or replacement of the building, premises, trade dress, equipment and grounds as may be necessary for your Facility to conform to the standards then applicable to new ALLOY facilities, regardless of the cost of such modernizations and/or replacements; (iv) you are not in default of this Agreement or any other agreement pertaining to the franchise granted, you have not been in default of this Agreement on three or more occasions during the term of this Agreement, regardless of whether any cure has been effectuated, have satisfied all monetary and material obligations on a timely basis during the term, and are in good standing; (v) if leasing the Facility premises, you have renewed the lease and have provided written proof of your ability to remain in possession of the premises throughout the renewal pe
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 51–56)
What This Means (2025 FDD)
According to Alloy's 2025 Franchise Disclosure Document, franchisees must meet certain modernization and remodeling requirements as a condition of renewing their franchise agreement. To renew for an additional 10-year term, Alloy franchisees must comply with modernization requirements outlined in subparagraph 5.E of the franchise agreement. They must also perform any further modernization or replacements to ensure the facility meets the standards applicable to new Alloy facilities at the time of renewal, regardless of the cost.
Specifically, the Alloy franchisee must modernize or replace the building's interior, trade dress, equipment, fixtures, and improvements as necessary to conform to the standards of new Alloy facilities. This ensures that all locations maintain a consistent brand image and meet current customer expectations. These requirements are in addition to general maintenance and refreshing of the facility premises, which must be performed whenever necessary.
Compliance with these modernization and replacement requirements is expressly required for any renewal agreement. Alloy states that these requirements are reasonable and necessary to ensure continued public acceptance and patronage and to avoid deterioration or obsolescence of the facility. If a franchisee fails to make the required improvements or perform the necessary maintenance, Alloy has the right to make such improvements or perform the maintenance themselves, and the franchisee must reimburse Alloy for the costs incurred. In addition to these modernization requirements, the franchisee must also meet other conditions such as providing notice of intent to renew, signing the then-current franchise agreement, not being in default, renewing the facility lease, complying with training requirements, paying a $5,000 renewal fee, and executing a general release of claims.