What happens to the Extreme Art Studio Multi-Franchise Addendum if the Franchise Agreement is terminated?
Extreme_Art_Studio Franchise · 2024 FDDAnswer from 2024 FDD Document
| Provision | Section in Franchise Agreement and Multi-Franchise Addendum | Summary |
|---|---|---|
| (a) Length of the franchise term | Section 1.4 of Franchise Agreement and Section 5 of Multi-Franchise Addendum (Exhibit H-7) | 10 years. The Multi-Franchise Addendum terminates upon termination or expiration of the Franchise Agreement. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 43–46)
What This Means (2024 FDD)
According to the 2024 Extreme Art Studio Franchise Disclosure Document, the Multi-Franchise Addendum terminates if the Franchise Agreement is terminated or expires. The franchise term for Extreme Art Studio is 10 years, as detailed in Section 1.4 of the Franchise Agreement and Section 5 of the Multi-Franchise Addendum.
This means that if the franchisee's agreement with Extreme Art Studio is terminated, whether due to a breach of contract or at the end of the initial term, the Multi-Franchise Addendum, which likely outlines the terms for operating multiple franchise locations, will also end. The franchisee will no longer have the rights or obligations associated with the Multi-Franchise Addendum.
For a prospective franchisee, this highlights the importance of understanding the terms of both the Franchise Agreement and the Multi-Franchise Addendum. If the franchisee plans to expand and operate multiple Extreme Art Studio locations, they should be aware that the entire multi-unit agreement is contingent on the primary Franchise Agreement remaining in effect. Any termination of the Franchise Agreement will have significant implications for their ability to operate multiple locations.