Can the Fitstop Franchise Agreement be modified, and if so, how?
Fitstop Franchise · 2024 FDDAnswer from 2024 FDD Document
| m. Conditions for franchisor approval of transfer | Section 15.11 | Conditions include: you must be in full compliance with your Franchise Agreement; you must pay us all amounts due; transferee and its managers must satisfactorily complete our training program; transferee executes our thencurrent form of Franchise Agreement; you or transferee must pay transfer fee; we must approve written agreements regarding transfer; you must supply us with any additional information we reasonably require regarding the transfer; you must provide, as a personal covenant to the transferee, in addition to your covenants to us, an agreement not to seek to divert business from us and/or our franchisees; and you must sign a general release and other documents we require. Please also see post-term covenants described below in this Item 17 Chart. |
|---|---|---|
| n Franchisor's might of first referri | Section 15.2 | We have a right to acquire your business and so the |
| n. Franchisor's right of first refusal to acquire franchisee's business | Section 13.2 | We have a right to acquire your business under the same terms you are offering to a third party. |
| o. Franchisor's option to purchase franchisee's business | Section 15.3 | You must notify us if you plan to transfer your business to a third party. After you notify us, we will notify you whether we will purchase your business under the same terms you are offering to a third party. |
| p. Death or disability of franchisee | Section 15.12 | Subject to transfer rules; however, an administrative fee, not a transfer fee, is charged if the transfer is to a family member. |
| q. Noncompetition covenants during the term of the franchise | Section 18.2 | You may not have an ownership interest in, financial interest in, or perform services for related businesses anywhere. You also must not divert or attempt to divert any business or customer from us or our franchisees, influence your previous customers or our other franchisees, injure our goodwill, or employ or solicit our employees subject to applicable noncompetition covenants, common law duties of good faith and fair dealing or other applicable business practice laws, and state law. |
| r. Noncompetition covenants after | Section 18.3 | For two years, you must not: divert or attempt to divert any business or customer from us or our franchisees or injure our goodwill; employ or solicit our employees; influence or attempt to influence your previous customers or other franchisees. You must not use the name "Fitstop" |
| the franchise is terminated or expires |
| s. Modification of the agreement | Sections 5.2, 20.4 | No modifications generally except by written agreement, but we may change the Operations Manuals and Franchise System standards at any time. You will be required to implement these changes at your own cost. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION (FDD pages 42–47)
What This Means (2024 FDD)
According to Fitstop's 2024 Franchise Disclosure Document, the Franchise Agreement can generally only be modified through a written agreement between Fitstop and the franchisee. However, Fitstop retains the right to unilaterally change the Operations Manuals and Franchise System standards at any time. Franchisees are then required to implement these changes at their own cost.
This means that while specific terms of the Franchise Agreement are difficult to alter without mutual consent, Fitstop has the power to evolve its operational guidelines. These modifications to the Operations Manual can cover a broad range of aspects of the Fitstop business, from marketing strategies to equipment standards.
For a prospective Fitstop franchisee, this highlights the importance of understanding that the business model can evolve over time, and they will be responsible for adapting to these changes financially. It is important to clarify the scope and frequency of potential changes to the Operations Manual and how these changes might impact the profitability of the Fitstop franchise.