What is the initial term length of the Crown Gold Exchange franchise agreement?
Crown_Gold_Exchange Franchise · 2024 FDDAnswer from 2024 FDD Document
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 Crown Gold 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 Crown Gold 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 Crown Gold Franchising) renovations and changes to the Business as Crown Gold Franchising requires (including a Remodel, if applicable) to conform to the thencurrent System Standards;
- (iv) Franchisee and its Owners execute Crown Gold Franchising's then-current standard form of franchise agreement and related documents (including personal guaranty), which may be materially different than this form (including, without limitation, higher and/or different fees), except that Franchisee will not pay another initial franchise fee and will not receive more renewal or successor terms than described in this Section;
- (v) Franchisee and each Owner executes a general release (on Crown Gold Franchising's then-standard form) of any and all claims against Crown Gold Franchising, its affiliates, and their respective owners, officers, directors, agents and employees.
Source: Item 22 — CONTRACTS (FDD pages 38–39)
What This Means (2024 FDD)
According to Crown Gold Exchange's 2024 Franchise Disclosure Document, the initial term of the franchise agreement is 10 years, commencing on the effective date. This means a franchisee will operate their Crown Gold Exchange business under the terms of the agreement for a decade.
At the end of the initial term, a franchisee has the option to enter into a successor agreement with Crown Gold Exchange. However, this is contingent upon several conditions. The franchisee must notify Crown Gold Exchange of their intent to renew within a specific timeframe, between 90 and 180 days prior to the end of the term.
Furthermore, the franchisee must be in full compliance with the existing agreement and any other agreements with Crown Gold Exchange or its affiliates, both at the time of election and at the time of renewal. Crown Gold Exchange may also require renovations or changes to the business to meet current system standards, potentially including a remodel. The franchisee will also need to execute Crown Gold Exchange's then-current standard franchise agreement, which may have materially different terms and fees, although they will not have to pay another initial franchise fee. Finally, the franchisee must execute a general release of claims against Crown Gold Exchange.