Under what condition might Pump It Up extend the Initial Term of the Franchise Agreement?
Pump_It_Up Franchise · 2025 FDDAnswer from 2025 FDD Document
rmination that the continued operation of the Franchised Business by you will result in imminent danger to public health or safety, we may terminate this Agreement pursuant to Section 19.A.(10) or, in our sole
discretion, we may require you to close the Franchised Business temporarily to make the necessary repairs or alterations.
- (4) Upon receipt of notice from us, you agree to remodel, expand, redecorate, re-equip and/or refurnish the Premises and the Franchised Business to conform the Franchised Business to the image of the System for new Pump It Up Businesses. If any single modification, with the exception of new Arena equipment or new party equipment, exceeds $10,000, then you will have 6 months to comply with such modifications. Except as described below, we will not require a major redesign of the Franchised Business that will cost more than $10,000 more than twice during the Initial Term of this Agreement. In the event we determine, in our sole discretion, that you cannot amortize the cost of the major redesign over the remaining years of the Initial Term, we may agree to extend the Initial Term of this Agreement for the sole purpose of al
Source: Item 23 — RECEIPTS (FDD pages 60–225)
What This Means (2025 FDD)
According to Pump It Up's 2025 Franchise Disclosure Document, the company may agree to extend the Initial Term of the Franchise Agreement if a major redesign is required. Specifically, if Pump It Up determines, in its sole discretion, that a franchisee cannot amortize the cost of a major redesign over the remaining years of the Initial Term, Pump It Up may agree to extend the Initial Term. The extension would be solely for the purpose of allowing the expenditure for the redesign to occur.
This provision offers a potential benefit to franchisees who face significant, unexpected costs for redesigns mandated by Pump It Up. Without this clause, a franchisee might struggle to recoup their investment before the end of the initial term. The FDD specifies that this applies to redesigns exceeding $10,000 more than twice during the Initial Term of the Agreement, excluding new Arena equipment or new party equipment.
However, it's important to note that this extension is not guaranteed. Pump It Up retains sole discretion in determining whether to grant the extension. Additionally, the extension is limited to the purpose of allowing the expenditure to occur, suggesting it may only be for a defined period necessary to amortize the costs. Franchisees should carefully consider the potential for required redesigns and discuss this extension provision with Pump It Up during their due diligence.