Under what conditions can Fitstop extend the time a franchisee has to locate an appropriate premises?
Fitstop Franchise · 2024 FDDAnswer from 2024 FDD Document
- 9.1.1 Unless we have already agreed upon a location for the Premises at the time we execute this Agreement, you must use your best efforts to locate and enter into a lease agreement for a Premises within the Designated Territory that we approve within six (6) months of the Effective Date. As part of that process, it is your responsibility to: (i) inspect prospective premises; (ii) report back to us on a weekly basis with details of the prospective premises inspected in the prior seven (7) calendar days; (iii) consider any potential premises we may suggest; and (iv) if we deem necessary, engage an agent we approve to assist you in locating an appropriate premises within the Designated Territory.
- 9.1.2 If you have not located an appropriate premises by the time specified above, we may in our discretion (i) agree to terminate this Agreement or (ii) agree to extend the time you have to locate an appropriate premises.
Source: Item 23 — RECEIPTS (FDD pages 50–135)
What This Means (2024 FDD)
According to Fitstop's 2024 Franchise Disclosure Document, a franchisee is generally given six months from the effective date of the franchise agreement to locate and secure a lease for a premises that Fitstop approves. During this period, the franchisee must diligently inspect potential locations, provide weekly updates to Fitstop, consider any locations suggested by Fitstop, and, if deemed necessary by Fitstop, engage an approved agent to assist in the search.
However, if the franchisee fails to secure an appropriate premises within the initial six-month timeframe, Fitstop has the discretion to take one of two actions. Fitstop may either agree to terminate the franchise agreement, effectively ending the relationship, or, alternatively, Fitstop may agree to extend the time the franchisee has to locate a suitable premises.
This clause provides Fitstop with flexibility in dealing with franchisees who may be struggling to find a location. While it offers a potential lifeline to franchisees who need more time, it's important to note that the decision to grant an extension is entirely at Fitstop's discretion. A prospective franchisee should discuss with Fitstop what factors they consider when deciding whether to grant such an extension.