Does Fitstop have the right to pursue collection action against members?

According to Fitstop's 2024 Franchise Disclosure Document, Fitstop has the right, but not the obligation, to pursue collection actions against members. Fitstop is not obligated to pursue collection matters at all or any further than they may choose.

If Fitstop makes an assignment of the right to collect and enforce payment, the franchisee will pay all attorneys' fees, court costs, and expenses involved. If the franchisee collects monies due on a delinquent member account, the franchisee will be responsible to Fitstop for any unpaid royalties, management fees, note payments, and other payments (if any) due on the amounts collected. The franchisee must keep Fitstop advised of any legal or other proceedings which the franchisee institutes, including the outcome of any proceedings.

This clause is important for prospective franchisees as it clarifies that while Fitstop can pursue collections, it is not required to do so. This means the franchisee may need to handle member debt collection themselves, or Fitstop may choose to handle it. If Fitstop assigns the right to collect to someone else, the franchisee is responsible for the associated legal costs. Furthermore, if the franchisee successfully collects on a delinquent account, they must first satisfy any outstanding payments owed to Fitstop before retaining the remaining funds.