What is the earliest a Beauty Bungalows franchisee can notify the franchisor of their intent to renew the agreement?
Beauty_Bungalows Franchise · 2025 FDDAnswer from 2025 FDD Document
[Item 22: CONTRACTS]
- 3.05 Renewal Agreement.
Prior to the expiration of this Agreement, Franchisee must execute a renewal franchise agreement and all other legal agreements in Franchisor's then-current form for new franchisees.
These agreements may vary in material aspects from this Agreement, including, but not limited to, higher royalty and advertising fees.
Franchisee, prior to the expiration of this Agreement, must complete, to the satisfaction of Franchisor, those renovations, upgrades and/or modernizations of the Franchise as set forth in the Manual or as reasonably required by the Franchisor.
Prior to executing a renewal franchise agreement, Franchisor, in its sole discretion, may require Franchisee to execute a general release of all claims Franchisee may have against Franchisor and all principals of Franchisor.
This release shall include all claims arising under any federal, state, or local law, rule, or ordinance arising out of or concerning this Agreement (to the fullest extent permitted by law) and shall be in a form satisfactory to Franchisor.
If Franchisee fails to execute a renewal franchise agreement prior to the expiration of this Agreement and Franchisor fails to give Franchisor a notice of non-renewal pursuant to Section 3.04 above, then this Agreement will automatically be extended from month-to-month until a renewal franchise agreement is executed or until Franchisor delivers a notice of non-renewal pursuant to Section 3.04 above.
- 3.06 Renewal Fee.
Upon signing a renewal franchise agreement, Franchisee will not be required to pay another Initial Franchise Fee, but will be required to pay a renewal fee equal to: 15% of our then-current initial franchise fee or $7,500, whichever is greater.
Source: Item 22 — CONTRACTS (FDD pages 47–48)
What This Means (2025 FDD)
Based on the 2025 Beauty Bungalows Franchise Disclosure Document, a franchisee must execute a renewal franchise agreement prior to the expiration of their current agreement. The renewal agreement must be in Beauty Bungalows' then-current form for new franchisees, and may include materially different terms, such as higher royalty and advertising fees.
Additionally, prior to executing the renewal agreement, Beauty Bungalows may require the franchisee to complete renovations, upgrades, or modernizations to the franchise as outlined in the manual or as reasonably required by the franchisor. Beauty Bungalows may also require the franchisee to execute a general release of all claims against the franchisor and its principals, covering claims arising under any federal, state, or local law related to the agreement.
If a franchisee fails to execute a renewal agreement before the expiration of the current agreement, and Beauty Bungalows does not provide a notice of non-renewal, the agreement will automatically extend on a month-to-month basis. This extension continues until a renewal agreement is executed or until Beauty Bungalows delivers a notice of non-renewal. Upon signing a renewal franchise agreement, the franchisee will not be required to pay another initial franchise fee, but must pay a renewal fee equal to 15% of the then-current initial franchise fee or $7,500, whichever is greater.