What happens if a Fitstop franchisee fails to notify Fitstop of changes to the proposed transfer terms?

According to the 2024 Fitstop FDD, if there are any material changes to the terms and conditions of a proposed transfer after Fitstop has either declined to exercise its Right of First Refusal or after the period to exercise that right has expired, the franchisee must inform Fitstop of these changes in writing. Following this notification, Fitstop has an additional 10 calendar days to decide whether to exercise its Right of First Refusal.

If the franchisee fails to notify Fitstop of these material changes and proceeds with the transfer, it is not explicitly stated in this section what the consequences would be. However, Fitstop retains the right to approve or disapprove the transfer, and failure to disclose material changes could be grounds for disapproval or potentially a breach of the franchise agreement.

It is important for a prospective Fitstop franchisee to understand the implications of failing to comply with the transfer requirements. Since the FDD does not explicitly state the consequences of failing to report changes to the transfer terms, it would be prudent for a prospective franchisee to seek clarification from Fitstop regarding the specific penalties or repercussions for such non-compliance. This will help ensure full understanding of the obligations and potential risks associated with transferring the franchise.