When does a new Right of First Refusal commence for Fitstop?

According to Fitstop's 2024 Franchise Disclosure Document, a new Right of First Refusal commences if a proposed transfer is not completed within 90 calendar days. This 90-day period starts after Fitstop notifies the franchisee that it will not exercise its Right of First Refusal, or after the time allowed for Fitstop to make that election expires. This new right applies to the transaction in question and any subsequent proposed sales or transfers by the franchisee.

This clause means that if a Fitstop franchisee attempts to sell their franchise but the sale falls through after Fitstop has waived its right to first refusal, the franchisee cannot simply revive the original deal later without giving Fitstop another chance to buy the franchise themselves. This protects Fitstop's ability to control who joins their franchise system.

For a prospective Fitstop franchisee, this highlights the importance of ensuring any transfer of ownership is completed promptly once Fitstop has declined to exercise its Right of First Refusal. Failure to complete the transfer within the 90-day window will trigger a new Right of First Refusal, potentially delaying or complicating the sale process. The franchisee must also provide Fitstop with written notice of any proposed transfer and comply with all provisions related to the Right of First Refusal.