Is the Fly Fitness Developer allowed to create any obligation on behalf of the Franchisor?
Fly_Fitness Franchise · 2024 FDDAnswer from 2024 FDD Document
- 11.1 Independent Licensee. Developer is and shall be an independent licensee under this Agreement, and no partnership shall exist between Developer and Franchisor. This Agreement does not constitute Developer as an agent, legal representative, or employee of Franchisor for any purpose whatsoever, and Developer is not granted any right or authority to assume or create any obligation for or on behalf of, or in the name of, or in any way to bind Franchisor. 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 Development Agreement explicitly states that the Developer acts as an independent licensee and not as an agent, legal representative, or employee of Fly Fitness. This distinction is crucial as it clarifies the boundaries of the relationship between the Developer and Fly Fitness.
The agreement specifically prohibits the Developer from assuming or creating any obligation on behalf of Fly Fitness. This means the Developer cannot enter into contracts, incur debts, or make representations that would legally bind Fly Fitness. The Developer also agrees not to take any actions or make any advertisements that could negatively impact Fly Fitness's rights or be detrimental to the brand, other developers, or franchisees.
To further protect Fly Fitness, the Developer is required to indemnify and hold Fly Fitness harmless from any liabilities, losses, attorney's fees, or damages that Fly Fitness might incur due to claims, demands, taxes, costs, or judgments arising from the established relationship. This includes any costs related to the transfer of development rights, defaults under leases, or any other relationships stemming from the development and operation of Fly Fitness outlets. This clause ensures that the Developer is financially responsible for their own actions and cannot create financial obligations for Fly Fitness.