What is the length of the initial term for a Baya Bar franchise agreement?
Baya_Bar Franchise · 2024 FDDAnswer from 2024 FDD Document
. Franchisee agrees that such implementation of Franchisor's rights pursuant to this Section 3.2 is deemed not to impair or injure Franchisee's rights pursuant to Section 2 hereof.
- 4. TERM. Unless terminated earlier in accordance with the terms set forth in this Agreement, this Agreement and the Franchise granted hereunder shall commence upon the Effective Date set forth above, and terminate on the date that is ten (10) years following the Opening Date, as defined in Section 8 hereof (the "Term").
- 5. SUCCESSOR OPTIONS. Subject to the terms and conditions of this Agreement, Franchisee shall have the right, following the expiration of the Term hereof, to enter into a new franchise agreement and other agreements then customarily employed by Franchisor
and in the form then generally being offered to prospective franchisees in the state in which the Territory is located (the "Successor Franchise Agreement") for two (2) additional terms of five (5) years. The term of each such Successor Franchise Agreement shall commence upon the date of expi
Source: Item 22 — CONTRACTS (FDD page 56)
What This Means (2024 FDD)
According to Baya Bar's 2024 Franchise Disclosure Document, the initial term for a Baya Bar franchise agreement is 10 years. The agreement commences on the effective date and terminates 10 years following the opening date of the franchise. This is a fairly standard initial term length in the franchise industry.
Following the initial 10-year term, Baya Bar offers franchisees the option to enter into a new franchise agreement, called the "Successor Franchise Agreement", for two additional terms of 5 years each, provided they meet certain conditions. The franchisee must pay a successor agreement fee of $3,500 per term to renew the agreement.
It is important to note that Baya Bar has the right to not offer a successor franchise agreement if they decide to withdraw from the marketing area or territory where the franchise is located. Additionally, the agreement may continue on a month-to-month basis if applicable law requires Baya Bar to give the franchisee notice prior to the expiration of the term.