Where in the Beauty Bungalows FDD are the requirements for franchisee renewal or extension summarized?
Beauty_Bungalows Franchise · 2025 FDDAnswer from 2025 FDD Document
enew Franchisee's license due to a condition as set forth in Sections 3.03(a), (b), (c) or (d), then Franchisor must give Franchisee a notice of non-renewal prior to the expiration of this Agreement.
- 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,
Source: Item 22 — CONTRACTS (FDD pages 47–48)
What This Means (2025 FDD)
According to Beauty Bungalows' 2025 Franchise Disclosure Document, Item 22, section 3.05, covers the renewal agreement. To renew their franchise agreement, a franchisee must execute a renewal franchise agreement, along with all other legal agreements, using Beauty Bungalows' then-current form for new franchisees. These new agreements may differ significantly from the original agreement, potentially including higher royalty and advertising fees.
Before the current agreement expires, the franchisee must complete any required renovations, upgrades, or modernizations to the franchise to Beauty Bungalows' satisfaction, as detailed in the manual or as reasonably required by Beauty Bungalows. Beauty Bungalows may also require the franchisee to execute a general release of all claims against Beauty Bungalows and its principals before a renewal agreement is executed. This release covers all claims arising from federal, state, or local laws 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.
Item 22, section 3.06, states that upon signing a renewal franchise agreement, the franchisee will not be required to pay another Initial Franchise Fee. However, the franchisee must pay a renewal fee equal to 15% of Beauty Bungalows' then-current initial franchise fee or $7,500, whichever is greater.