When does the initial term for a Beehive Homes franchise agreement end?
Beehive_Homes Franchise · 2025 FDDAnswer from 2025 FDD Document
- 5.1. Initial Term. This Agreement shall have an initial Term commencing on the Effective Date hereof and ending on the last day of the calendar month which is ten (10) years after the calendar month in which Franchise Royalties are first due under this Agreement, unless terminated at an earlier date as provided herein.
- 5.2. Renewal Terms. Subject to the terms and conditions set forth in Section 5.3 below, Franchisee may renew its franchise upon the expiration of the initial Term or any renewal Term for additional consecutive ten (10) year Terms by giving Franchisor written notice of intent to renew at least six (6) months but not more than nine (9) months prior to the expiration date of the then current Term. Failure of the Franchisee to give such notice shall constitute an Election Not to Renew, unless the law of the state in which the Home is located provides otherwise. The Franchisee shall not be required to pay any renewal fee or additional franchise fee in connection with any renewal hereunder.
- 5.3. Conditions to Renewal. Franchisee's renewal under Section 5.2 is subject to Franchisee's compliance with the following on the date of the notice of intent to renew and on the first day of the renewal Term: (i) Franchisee is not in default of any provision of this Agreement or any other Franchise Agreement or any other agreement with Franchisor or its Affiliates to which the Franchisee is a party; (ii) Franchisee is directly or indirectly the owner of the Home and will be for the renewal Term; (iii) Franchisee executes at least three (3) months prior to the first day of the renewal Term the then current form of Franchise Agreement being used by Franchisor, which Franchise Agreement may contain materially different terms from those contained in this Agreement; and (iv) Franchisee, its Home, equipment and procedures meet the current Standards applicable to new franchisees.
- 5.4. Non-Renewal. If Franchisee makes an Election Not to Renew as provided in 5.2 above, this Agreement shall not expire but shall continue in full force and effect on a month-tomonth basis until terminated by Franchisor by delivery to Franchisee of a written notice of termination at least thirty (30) days prior to the date of such termination.
Source: Item 23 — RECEIPTS (FDD pages 34–123)
What This Means (2025 FDD)
According to Beehive Homes' 2025 Franchise Disclosure Document, the initial term of the franchise agreement starts on the effective date and concludes on the last day of the calendar month that is ten years after the month when franchise royalties first become due. This means the exact end date will vary depending on when royalties begin for each specific franchise location.
This ten-year term is a standard duration for many franchise agreements, providing franchisees with a substantial period to establish and operate their business while allowing Beehive Homes to maintain brand standards and collect royalties. The agreement can be terminated earlier if certain conditions are met, as detailed in the franchise agreement.
At the end of the initial term, franchisees have the option to renew their agreement for additional ten-year terms, provided they meet specific conditions. These conditions include not being in default of any agreements with Beehive Homes, owning the Home directly or indirectly, executing the then-current form of the franchise agreement, and meeting the current standards applicable to new franchisees. The new franchise agreement may contain materially different terms from the original agreement.
If a franchisee chooses not to renew, the agreement does not immediately expire. Instead, it continues on a month-to-month basis until Beehive Homes terminates it with a written notice at least thirty days prior to the termination date. This provides a transition period, but the franchisee operates under the risk of a relatively short termination notice from Beehive Homes.