How many additional terms of five years each can a Baya Bar franchisee potentially obtain?
Baya_Bar Franchise · 2024 FDDAnswer from 2024 FDD Document
itory. 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, a franchisee has the option to enter into a new franchise agreement after the initial term expires. Specifically, Baya Bar offers the franchisee the right to enter into a Successor Franchise Agreement for two additional terms, each lasting five years.
To exercise this option, the franchisee must meet certain conditions outlined in the franchise agreement. These conditions likely include being in good standing with Baya Bar, completing any required additional training, securing the right to continue occupying the premises, executing a general release of claims, performing any required remodeling or repairs, and paying the required Successor Agreement Fee.
The Successor Agreement Fee is $3,500 per term. Therefore, to renew for both available terms, a franchisee would need to pay a total of $7,000 in Successor Agreement Fees. This renewal option provides an opportunity for franchisees to continue operating their Baya Bar business for an extended period, assuming they meet the specified requirements and find the terms of the Successor Franchise Agreement acceptable.