What certification and warranty is provided by Fitstop regarding the owners of the Franchise?
Fitstop Franchise · 2024 FDDAnswer from 2024 FDD Document
During any period following the death or declaration of incapacity of you, your estate must comply with the terms and conditions of this Agreement.
Under no conditions will such compliance be excused or reduced because of the death or incapacity of you.
- 15.14 The transfer of this Franchise upon written notice by an individual or partnership to a corporation wholly-owned by the preexisting owner or all preexisting owners of this Franchise shall not require our approval nor the payment of the application or transfer fees.
However, the transferring owner or owners must agree to remain personally responsible to us for your performance of the terms and conditions of this Agreement.
The absence of any additional written agreements and/or guarantees concerning the transfer will not affect the continuing liability of the transferring owner or owners of this Franchise.
We may impose similar requirements on any proposed transfer of this Franchise to a trust.
- 15.15 If the transfer is an assignment of the Franchise by an individual to a corporation in which you are and, so long as they remain the majority stockholder and the officer responsible for the full-time personal operation and supervision of the Franchise, and the transfer does not result in the cumulative transfer of over 50% of the interest or interests of the original owner or owners, the Application Fee will be charged without the Transfer Fee.
However, we require that the transferor, or transferors and each of them, personally guarantee all obligations of the Franchise and reserve the right to reasonably reject such transfer.
- ©2024 Fitstop USA, Inc. 15.16 Involuntary transfers of this Agreement or the assets of the Franchise, such as by legal process, are not permitted, are not binding on us, and are grounds for the termination of this Agreement.
Source: Item 23 — RECEIPTS (FDD pages 50–135)
What This Means (2024 FDD)
Based on the 2024 Fitstop Franchise Disclosure Document, there is no mention of Fitstop providing any specific certifications or warranties related to the owners/franchisees. However, the FDD does outline certain requirements and conditions regarding the transfer of ownership and the responsibilities of the owner.
Specifically, if the owner of the Fitstop franchise dies or is declared incapacitated, their estate must still comply with the terms of the Franchise Agreement. The obligations outlined in the agreement will not be excused or reduced due to the owner's death or incapacity. In the event of a transfer of the franchise to a corporation wholly-owned by the existing owner(s), Fitstop's approval is not required, nor are application or transfer fees, but the transferring owner(s) must remain personally responsible for the franchise's performance.
If the franchise is assigned by an individual to a corporation where the individual remains the majority stockholder and is responsible for the full-time operation and supervision of the franchise, an application fee will be charged, but not a transfer fee, provided the transfer does not result in the cumulative transfer of over 50% of the original owner's interest. In this case, the transferor must personally guarantee all obligations of the franchise, and Fitstop reserves the right to reasonably reject the transfer. Involuntary transfers of the agreement or assets are not permitted and can lead to termination of the agreement.
Since the FDD does not provide details on certifications or warranties for owners, it is recommended that prospective Fitstop franchisees ask the franchisor directly about any available certifications, training programs, or guarantees related to the ownership and operation of the franchise. This will help ensure a clear understanding of the support and resources Fitstop provides to its franchisees.