Under what conditions can Bor Restoration choose not to renew a franchise agreement?
Bor_Restoration Franchise · 2024 FDDAnswer from 2024 FDD Document
| PROVISION | SECTION IN FRANCHISE AGREEMENT | SUMMARY |
|---|---|---|
| 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, Bor Restoration is not obligated to renew a franchise agreement if certain conditions are met. Specifically, Bor Restoration can choose not to renew if the franchisee has outstanding material defaults or owes money to Bor Restoration at the time of renewal. Additionally, if the franchisee has received more than three default notices during the initial franchise term or one notice during a Successor Franchise Term, Bor Restoration may deny renewal.
Bor Restoration also retains the right not to renew the franchise agreement if, in their Reasonable Business Judgment, they determine that renewal is not in the best interest of the company. Furthermore, to renew the franchise agreement, the franchisee must sign Bor Restoration's then-current Franchise Agreement, which may contain terms that are significantly different from the original agreement. The franchisee is also required to pay a renewal fee to Bor Restoration.
These conditions highlight the importance of maintaining compliance with the franchise agreement and fulfilling all financial obligations to Bor Restoration. A prospective franchisee should carefully consider these renewal terms and the potential for changes in the new franchise agreement, as these factors could significantly impact their long-term business operations and relationship with Bor Restoration.