What must an assignee do when Fly Fitness assigns the Franchise Agreement to them?
Fly_Fitness Franchise · 2024 FDDAnswer from 2024 FDD Document
Franchisor shall have the right to assign this Agreement, and all of Franchisor's rights and privileges hereunder, to any person, firm, corporation, or other entity, without Franchisee's permission or prior knowledge, provided that, with respect to any assignment resulting in the subsequent performance by the assignee of Franchisor's obligations, the assignee shall expressly assume and agree to perform Franchisor's obligations hereunder.
Source: Item 22 — CONTRACTS (FDD pages 44–45)
What This Means (2024 FDD)
According to Fly Fitness's 2024 Franchise Disclosure Document, Fly Fitness has the right to assign the Franchise Agreement to another entity without the franchisee's permission or prior knowledge. However, if the assignment results in the assignee performing Fly Fitness's obligations, the assignee must expressly assume and agree to perform those obligations. This means the new entity taking over the franchise agreement must commit to fulfilling the duties and responsibilities that Fly Fitness had under the original agreement.
This provision protects the franchisee by ensuring that if Fly Fitness assigns the agreement, the new franchisor is legally bound to uphold the terms of the agreement. It ensures continuity and stability in the franchise relationship, as the franchisee can expect the same level of support and adherence to the agreement from the assignee as they did from Fly Fitness.
For a prospective Fly Fitness franchisee, this clause offers some reassurance that a change in franchisor will not negatively impact their business. However, it is important to carefully review the terms of the franchise agreement to fully understand the scope of Fly Fitness's obligations and what the assignee would be required to assume. Franchisees should also seek legal counsel to understand their rights and options in the event of an assignment.