What are the requirements for a Bor Restoration franchisee to renew or extend their franchise term?
Bor_Restoration Franchise · 2024 FDDAnswer from 2024 FDD Document
| PROVISION | SECTION IN FRANCHISE AGREEMENT | SUMMARY |
|---|---|---|
| a. Length of the franchise term | 4 | Ten years unless terminated sooner. |
| b. Renewal or extension of the term | 4 | Two additional 5-year terms if all obligations for Successor Franchise Rights are met. |
| c. Requirements for franchisee to renew or extend | 4 | You must provide notice, you must have no outstanding material defaults or money owed, you must not have had more than three default notices during the initial term or one notice during the Successor Franchise Term, we must not have determined in our Reasonable Business Judgment not to renew, you must sign the then-current Franchise Agreement (which may have terms materially different than those of your current Franchise Agreement) and pay the renewal fee. |
Source: Item 17 — Renewal, Termination, Transfer, and Dispute Resolution (FDD pages 33–35)
What This Means (2024 FDD)
According to Bor Restoration's 2024 Franchise Disclosure Document, the franchise agreement has an initial term of ten years, and Bor Restoration franchisees have the option to renew for two additional terms of five years each if they meet the requirements for Successor Franchise Rights.
To renew the franchise agreement, a Bor Restoration franchisee must provide notice of their intent to renew. They must also have no outstanding material defaults or money owed to Bor Restoration. The franchisee must not have received more than three default notices during the initial ten-year term, or more than one notice during any Successor Franchise Term.
Bor Restoration must not have determined, using their Reasonable Business Judgment, that they do not want to renew the agreement. Additionally, the franchisee must sign Bor Restoration's then-current Franchise Agreement, which may contain terms that are significantly different from the terms in the original agreement. Finally, the franchisee must pay the renewal fee to Bor Restoration.
It is important for prospective franchisees to understand that the terms of the renewal agreement may differ from the original agreement. Therefore, franchisees should carefully review the renewal agreement and consider seeking legal counsel before signing it.