What is the reasonably certain to be exercised term in years for Batteries Plus Bulbs?
Batteries_Plus_Bulbs Franchise · 2025 FDDAnswer from 2025 FDD Document
In 2024, the Company has one licensing agreement which provided the Company with the right to market branded products across multiple product categories in the United States, its territories and Canada through its corporate stores and franchises and over a captive web domain. This agreement runs through December 31, 2027, and will renew, unless properly terminated by either party, with the same terms for one additional five-year renewal period.
Source: Item 21 — Financial Statements (FDD pages 79–80)
What This Means (2025 FDD)
According to the 2025 Batteries Plus Bulbs FDD, the company has a licensing agreement that extends through December 31, 2027. This agreement includes a clause for one additional five-year renewal period, provided neither party terminates it. Therefore, if neither party terminates the agreement, the reasonably certain to be exercised term is five years.
This renewal clause is significant for Batteries Plus Bulbs franchisees because it ensures the company can continue marketing branded products through its stores and online. The agreement covers multiple product categories in the United States, its territories, and Canada. This continuity is crucial for maintaining brand recognition and customer loyalty.
Franchisees should note that the renewal is contingent upon both parties not terminating the agreement. While the FDD indicates that Batteries Plus Bulbs met its minimum license fee requirements in 2023 and 2024, ensuring the agreement remains in good standing, franchisees should monitor any changes in licensing expenses or agreement terms that could affect the renewal. Staying informed about these factors will help franchisees anticipate and prepare for any potential impacts on their business operations.