What is the franchisee's obligation to pay fees and other amounts in connection with the Fitstop Franchised Business?
Fitstop Franchise · 2024 FDDAnswer from 2024 FDD Document
1.4 You agree and acknowledge that: (i) you will pay all fees and other amounts payable by you as set out in this Agreement as and when required in connection with the Franchised Business; and (ii) the payments of any amounts to us constitute reasonable consideration for the franchise and other rights you are awarded in connection with your Franchised Business during the term hereof.
©2024 Fitstop USA, Inc. 13.3 Royalty Fee(s); Minimum Royalty. Upon the earlier of the date (a) you open your Franchised Business, and (b) the date you are required to open the Franchised Business under this Agreement, you must pay us an ongoing royalty fee (the "Royalty Fee") amounting to the greater of: (i)
13.5 Fund Contribution(s). You shall contribute to our brand development Fund in an amount equal to two percent (2%) of the Gross Revenue generated by the Franchised Business, which shall be billed and collected at the same time and manner as your recurring Royalty Fee under Section 13.4 above (your "Fund Contribution").
13.6 Annual Conference Contribution(s). You may be required to remit to ua an amount equal to $150 per month as a contribution to defray the costs associated with any annual conference we determine to establish and conduct for System Business owners (an "Annual Conference"), which shall be payable in the same manner as your Royalty Fee on the date we designate each calendar month once you are required to have your Franchised Business open and operating.
13.8 Other Amounts Payable to Third-Party Approved Supplier(s) and/or Otherwise in Connection with the Franchised Business. You must ensure that timely payment is made with respect to all amounts due and owing to: (i) any designated or other Approved Supplier for Required Items (products or services) that we designate in our Manuals or otherwise in writing, including our then-current Approved Supplier for merchant processing services, consistent with the applicable Approved Supplier's invoicing, terms and conditions; and (ii) any other third-party landlord, supplier, provider or other vendor that has been used or engaged by you in connection with the establishment and/or ongoing operation of the Franchised Business.
©2024 Fitstop USA, Inc. 4.8 You shall pay all traveling, living, compensation, or other expenses you, your General Manager and/or other personnel incur in connection with the initial training, supplementary trainings,
13.9.3 any amount payable by you to us under this Agreement.
Source: Item 23 — RECEIPTS (FDD pages 50–135)
What This Means (2024 FDD)
According to Fitstop's 2024 Franchise Disclosure Document, franchisees are obligated to pay various fees and amounts throughout the duration of their agreement. As stated in the agreement, the franchisee must pay all fees and other amounts as required in connection with the Franchised Business. Fitstop considers these payments as reasonable consideration for the franchise and the rights awarded to the franchisee.
Fitstop franchisees must pay an ongoing royalty fee, which is the greater of a specified amount or a percentage of gross revenue. Franchisees are also required to contribute to the brand development fund, set at two percent of gross revenue, to support marketing and promotion of the Fitstop brand. Additionally, franchisees may be required to contribute $150 per month towards the costs associated with the annual conference.
Beyond the fees paid directly to Fitstop, franchisees are responsible for other expenses. This includes payments to approved suppliers for required items and services, as well as payments to third-party landlords, suppliers, and vendors involved in establishing and operating the franchise. Franchisees are also responsible for covering expenses related to training, conferences, and conventions, including travel, lodging, and compensation for personnel attending these events. All payments from members for approved products and services through Fitstop's online ordering system are collected by Fitstop on behalf of the franchisee, with deductions made for merchant fees and any amounts owed to Fitstop under the agreement.