What power and authority does Fitstop require the franchisee to have to operate the Franchised Business?
Fitstop Franchise · 2024 FDDAnswer from 2024 FDD Document
originals and shall be valid, binding, and enforceable in accordance with their terms.
Section 21: Franchisee Representations and Acknowledgements
You, on behalf of yourself and your Franchise Owners, hereby represent, warrant and convey as follows to Franchisor:
- 21.1 You have all the requisite power and authority to operate the Franchised Business, and are duly licensed and qualified to transact business as a foreign entity in all jurisdictions in which the nature of the business it conducts makes such qualification as a foreign entity necessary.
- 21.2 You shall diligently and fully exploit the rights granted in this Franchise by personally devoting full time and best efforts and, in the case that more than one individual has executed this Franchise as the franchisee, then you shall personally devote full time and best efforts to the operation of the Franchise.You shall keep free from conflicting enterprises or any other activities which would be detrimental to or interfere with the business.
Source: Item 23 — RECEIPTS (FDD pages 50–135)
What This Means (2024 FDD)
According to Fitstop's 2024 Franchise Disclosure Document, franchisees must possess the necessary power and authority to operate the franchised business. Specifically, the franchisee must be duly licensed and qualified to conduct business as a foreign entity in any jurisdiction where such qualification is required. This means franchisees need to ensure they meet all legal and regulatory requirements to operate their Fitstop location in their chosen area.
Furthermore, Fitstop requires that franchisees personally devote full-time effort and their best efforts to the operation of the franchise. If multiple individuals are franchisees, this requirement applies to each of them. Franchisees must also avoid any conflicting enterprises or activities that could negatively impact or interfere with the Fitstop business. This underscores Fitstop's expectation that franchisees will be fully committed and focused on their Fitstop business.
Fitstop also designates a "Franchise Operator" who has the authority to act on behalf of the franchisee in all operational matters. This individual is identified in Schedule 1 of the Franchise Agreement. Fitstop can rely on the authority of this designated operator unless the franchisee notifies Fitstop in writing of a change, with a majority vote of those holding an ownership interest, assigning a different owner with at least a 25% ownership stake as the new Franchise Operator. This ensures clear lines of communication and decision-making authority between the franchisee and Fitstop.