Does Fitstop have the right to review and approve any changes to the Prescribed Lease Provisions?
Fitstop Franchise · 2024 FDDAnswer from 2024 FDD Document
9.3 Lease of Premises.
- 9.3.1 You are solely responsible for locating, proposing and securing a lease for the Premises we approve in writing prior to you securing the right to occupy and use such Premises for purposes of developing and operating the Franchised Business.
- 9.3.2 You must ensure that the lease for the Premises (the "Lease") contains and integrates the provisions and covenants set forth in this Section or that we designate in the Manuals at any time prior to you securing any Premises (the "Prescribed Lease Provisions"), with said Lease subject to our review and approval with respect to any markup or negotiated changes to said provisions as part of our overall right to approve the Premises itself.
- 9.3.3 You must perform and observe at all times the terms (including conditions and covenants) of any lease or other agreement affording you access to and use of the Premises.
- 9.3.4 You will be liable to pay all amounts owing in connection with the Lease and Premises governed thereby, and your failure to cure any defaults you have with respect to Tenant's (or its guarantors) monetary or non-monetary obligations under the Lease within the applicable cure periods set forth therein shall constitute a material default and, if the Lease is terminated or subject to termination, grounds for immediate termination of this Agreement by us upon written notice to you.
- 9.3.5 Where you have entered into a lease in respect of the Premises: (1) we may at any time during the Term notify you in writing that we require you to assign the lease of the Premises to us or our nominee; and (2) you must within seven (7) calendar days of such request assign the lease of the Premises to us or our nominee and sign all documents and take all necessary steps to effect the assignment of the lease of the Premises.
Source: Item 23 — RECEIPTS (FDD pages 50–135)
What This Means (2024 FDD)
According to Fitstop's 2024 Franchise Disclosure Document, the franchisee is responsible for finding a location and securing a lease, which Fitstop must approve. The lease must contain specific provisions, referred to as "Prescribed Lease Provisions," that Fitstop designates in its manuals.
Fitstop retains the right to review and approve any changes made to these Prescribed Lease Provisions. This means that while franchisees are responsible for negotiating the lease terms with the landlord, any alterations to the standard lease provisions required by Fitstop are subject to Fitstop's final approval. This ensures that the lease aligns with Fitstop's standards and protects its interests.
This requirement gives Fitstop significant control over the lease terms, which can impact the franchisee's business operations and financial obligations. The franchisee must ensure that any negotiated changes to the lease are acceptable to Fitstop to avoid potential conflicts or breaches of the franchise agreement. Furthermore, Fitstop can mandate the franchisee assign the lease to them or their nominee at any point during the term.