Is the Fly Fitness Developer allowed to advertise in a manner that may adversely affect the Franchisor?
Fly_Fitness Franchise · 2024 FDDAnswer from 2024 FDD Document
Developer agrees not to incur or contract any debt or obligation on behalf of Franchisor or commit any act, make any representation, or advertise in any manner which may adversely affect any right of Franchisor or be detrimental to Franchisor or other developers or franchisees of Franchisor. Pursuant to the above, Developer agrees to indemnify Franchisor and hold Franchisor harmless from any and all liability, loss, attorneys' fees, or damage Franchisor may suffer as a result of claims, demands, taxes, costs or judgments against Franchisor arising out of the relationship hereby established which specifically, but not exclusively, includes costs, losses, expenses, attorneys fees relative to assignment or the transfer of right to develop and transactional costs relative thereto, defaults under any leases, subleases, notes, receipt of revenues or any other relationships arising directly or indirectly out of the development and operation of the Fly Fitness outlets.
Source: Item 23 — RECEIPT (FDD pages 45–182)
What This Means (2024 FDD)
According to Fly Fitness's 2024 Franchise Disclosure Document, the Developer is explicitly prohibited from advertising in any manner that could adversely affect the Franchisor. The agreement specifies that the Developer is an independent licensee and not an agent, legal representative, or employee of Fly Fitness. This distinction is crucial because it clarifies that the Developer cannot create any obligations or make representations on behalf of Fly Fitness.
The agreement states that the Developer agrees not to incur any debt or obligation for Fly Fitness, nor can they commit any act or make any representation that could negatively impact Fly Fitness, its other developers, or franchisees. This includes advertising practices. This provision is designed to protect Fly Fitness from any misrepresentation or harmful advertising initiated by the Developer.
Furthermore, the Developer is obligated to indemnify Fly Fitness and hold them harmless from any liability, loss, attorneys' fees, or damages resulting from claims, demands, taxes, costs, or judgments against Fly Fitness. This indemnification extends to costs and expenses related to the assignment or transfer of development rights, transactional costs, defaults under leases, and any other relationships arising from the development and operation of Fly Fitness outlets. This clause reinforces the Developer's responsibility to ensure that their actions, including advertising, do not create any legal or financial risks for Fly Fitness.