Under what conditions might Beauty Bungalows require an extension fee for the premises acquisition deadline?
Beauty_Bungalows Franchise · 2025 FDDAnswer from 2025 FDD Document
her Beauty Bungalows, or any other reasonable criteria, as set forth in Section 10.02. Franchisor's assistance in no way constitutes a representation or warranty with respect to the property or the lease. Franchisee must secure a Premises that we have approved by signing a lease or purchase agreement within ninety (90) days of the date of this Agreement. We may extend the deadline for acquisition of a Premises by 90 days in our sole discretion, and we may require you to pay an extension fee equal to two thousand five hundred dollars ($2,500.00), and execute a general release as a condition of us agreeing to grant such extension. Franchisor will approve or disapprove your site within thirty (30) days after receiving notice of the proposed Franchise location from Franchisee. If we have accepted a Premises
Source: Item 22 — CONTRACTS (FDD pages 47–48)
What This Means (2025 FDD)
According to Beauty Bungalows' 2025 Franchise Disclosure Document, a franchisee is initially given 90 days from the date of the Franchise Agreement to secure an approved premises by signing a lease or purchase agreement. However, Beauty Bungalows retains the discretion to extend this deadline by an additional 90 days.
Beauty Bungalows may require the franchisee to pay an extension fee of $2,500.00 and execute a general release as a condition for granting this extension. This means that if a franchisee needs more time to find and secure a suitable location beyond the initial 90-day period, Beauty Bungalows has the right to charge a fee and require a release of liability in exchange for granting that extra time.
This policy has significant implications for prospective franchisees. It highlights the importance of diligent site selection and lease negotiation within the initial timeframe. Franchisees should factor in the potential cost of this extension fee into their initial budget and be aware of the requirement to sign a general release, which could limit their future legal recourse against Beauty Bungalows. Franchisees should also consider that Beauty Bungalows can terminate the agreement if a premises is accepted but the franchisee is unable or unwilling to acquire it within 90 days of the agreement's effective date.