Under what conditions can a Bombs Away franchisee enter into a successor agreement?
Bombs_Away Franchise · 2024 FDDAnswer from 2024 FDD Document
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ARTICLE 3. TERM
- 3.1 Term. This Agreement commences on the Effective Date and continues for 10 years.
- 3.2 Successor Agreement. When the term of this Agreement expires, Franchisee may enter into a successor agreement subject to the following conditions prior to each expiration:
- (i) Franchisee notifies Bombs Away Franchising of the election to renew between 90 and 180 days prior to the end of the term;
- (ii) Franchisee (and its affiliates) are in compliance with this Agreement and all other agreements with Bombs Away Franchising (or any of its affiliates) at the time of election and at the time of renewal;
- (iii) Franchisee has made or agrees to make (within a period of time acceptable to Bombs Away Franchising) changes to the Business as Bombs Away Franchising requires to conform to the then-current System Standards;
Source: Item 22 — CONTRACTS (FDD pages 35–36)
What This Means (2024 FDD)
According to Bombs Away's 2024 Franchise Disclosure Document, a franchisee may enter into a successor agreement when the current agreement's term expires, provided certain conditions are met. The initial franchise agreement term is 10 years.
While the specific conditions for entering a successor agreement are not detailed in the provided excerpts, Section 18.10 mentions that if a franchisee continues operating the business after the expiration of the term without a renewal agreement or successor franchise agreement executed by the parties in accordance with Section 3.2, Bombs Away may require the franchisee to cease operations or bind the franchisee to a renewal term of 5 years, with the franchisee deemed to have made a general release of liability as described in Section 3.2(vi).
To fully understand the conditions required by Bombs Away for a successor agreement, a prospective franchisee should ask the franchisor for a complete list of requirements. This would include any fees, updated agreement terms, and performance standards that must be met to qualify for a successor agreement.