Is a Better Blend franchisee required to pay a renewal fee to renew their franchise agreement?
Better_Blend Franchise · 2024 FDDAnswer from 2024 FDD Document
the agreements attached to this disclosure document.**
| Provision | Section in franchise | Summary |
|---|---|---|
| or other agreement | ||
| a. Length of the franchise term | Franchise | The term of the franchise agreement is 10 years from date of signing. The MUDA will expire on the date that your last franchise is scheduled to open. |
| Agreement (FA): § | ||
| 3.1 | ||
| Multi-Unit | ||
| Development | ||
| Agreement | ||
| (MUDA): §1(a) | ||
| b. Renewal or extension | FA: § 3.2 | You may obtain a successor franchise |
| of the term | ||
| MUDA: none | agreement for up to two additional 5-year | |
| terms. | ||
| c. Requirements for | For our franchise system, “renewal” means that | |
| franchisee to renew or | ||
| extend | ||
| at the end of your term, you sign our successor | ||
| franchise agreement for an additional five-year | ||
| term. You may be asked to sign a contract with | ||
| materially different terms and conditions than | ||
| your original contract. | ||
| To renew, you must give advance notice to us; | ||
| be in compliance with all contractual | ||
| obligations to us and third parties; renovate to | ||
| our then-current standards; sign then-current | ||
| form of franchise agreement and related | ||
| documents (including personal guaranty); have | ||
| not defaulted more than twice under the | ||
| franchise agreement; complied with all | ||
| requirements of ethics and values; pay renewal | ||
| fee; sign general release (unless prohibited by | ||
| applicable law). |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION (FDD pages 34–38)
What This Means (2024 FDD)
According to Better Blend's 2024 Franchise Disclosure Document, franchisees are required to pay a renewal fee to renew their franchise agreement. The initial franchise agreement lasts for a term of 10 years. Franchisees have the option to obtain a successor franchise agreement for up to two additional 5-year terms.
To renew the franchise agreement, Better Blend requires franchisees to provide advance notice, be compliant with all contractual obligations to Better Blend and third parties, renovate to then-current standards, sign the then-current form of franchise agreement and related documents (including personal guaranty), have not defaulted more than twice under the franchise agreement, comply with all requirements of ethics and values, pay a renewal fee, and sign a general release (unless prohibited by applicable law).
It is important to note that if a franchisee continues to operate their Better Blend franchise after the expiration of the term without a renewal agreement, Better Blend has the option to either terminate the operation at any time or deem the agreement renewed for a five-year term and collect the renewal fee. This highlights the importance of franchisees adhering to the renewal terms outlined in the franchise agreement to avoid potential disruptions or unexpected costs.