What is the timeframe a Fitstop franchisee has to cure a failure to comply with the Franchise Agreement after receiving written notice?
Fitstop Franchise · 2024 FDDAnswer from 2024 FDD Document
| d. Termination by franchisee | N/A | No early termination by you. |
|---|---|---|
| e. Termination by franchisor without cause | N/A | No termination by us without cause. |
| f. Termination by franchisor with cause | Section 16.1 | Franchisor can terminate if you are in breach of any term of the Franchise Agreement, if you are in default, if you fail to satisfactorily complete the Training, or if you fail to locate a Premises in the specified period of time. |
| g. "Cause" defined—curable defaults | Section 16.2 | We can terminate you for engaging in conduct that reflects unfavorably on the operation and reputation of the Franchise System and if you fail to cure such default within 24 hours of our notice to you. The following defaults, if not cured within 30 calendar days after we have given you written notice, may result in termination: failure to comply with any provisions of the Franchise Agreement or other agreement between us and you; failure to pay any monies due us or suppliers when due; entering into a contract with or take payment directly from a customer without our approval; failing to submit required financial information to us or a government entity or making false statements about your financial statements to us or a government entity; failing to pay all taxes and employee related withholdings relating to the operation of your franchise; failing to keep your business entity active and in good |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION (FDD pages 42–47)
What This Means (2024 FDD)
According to Fitstop's 2024 Franchise Disclosure Document, a franchisee may face termination if they fail to comply with the Franchise Agreement. However, Fitstop provides an opportunity to correct certain defaults. Specifically, if a franchisee engages in conduct that reflects unfavorably on the operation and reputation of the Fitstop Franchise System, they have 24 hours to cure the default after receiving notice from Fitstop.
Additionally, a Fitstop franchisee has 30 calendar days to correct other defaults after receiving written notice. These curable defaults include failing to comply with any provisions of the Franchise Agreement, failing to pay monies due to Fitstop or its suppliers, entering into unapproved contracts with customers, failing to submit required financial information or making false statements, failing to pay taxes and employee withholdings, or failing to keep the business entity active and in good standing.
It is important to note that some defaults are considered non-curable, meaning Fitstop can terminate the agreement immediately without providing an opportunity to cure. These non-curable defaults include conviction of a felony, attempting to hack Fitstop's software, disclosing confidential information, abandonment of the franchise, unauthorized transfer of the franchise, material misrepresentations when purchasing the franchise, repeated failure to comply with the Franchise Agreement, or insolvency/bankruptcy.