What is the effect of Fly Fitness consenting to a franchisee's relocation on the franchisee's fees?
Fly_Fitness Franchise · 2024 FDDAnswer from 2024 FDD Document
You may not change the location of your Franchised Business, without our written consent, which we may withhold in our sole discretion. The conditions under which we may allow you to relocate include the following: loss of your premises not due to your default, demographics of the surrounding area, proximity to other Fly Fitness outlets, lease requirements, traffic patterns, vehicular and pedestrian access, proximity to major roads, available parking, and overall suitability. If you wish to relocate, you must identify a new location for the Franchised Business that meets our approval, in accordance with our then-current site selection procedures, within 60 days. If you do not identify a site within this time period, we may terminate the Franchise Agreement. While you are closed for relocation, you must continue to pay us a minimum Royalty and Brand Fund contribution equal to the average paid during the four (4) calendar quarters immediately preceding the loss of your premises. Should we consent to your relocation, you will be required to pay us a relocation fee equal to twenty-five percent (25%) of the then-current initial franchise fee.
Source: Item 12 — TERRITORY (FDD pages 29–31)
What This Means (2024 FDD)
According to Fly Fitness's 2024 Franchise Disclosure Document, if Fly Fitness consents to a franchisee's request to relocate their Franchised Business, the franchisee will be required to pay Fly Fitness a relocation fee. This relocation fee is equal to twenty-five percent (25%) of the then-current initial franchise fee.
While the Fly Fitness location is closed for relocation, the franchisee must continue to pay Fly Fitness a minimum Royalty and Brand Fund contribution. This ongoing payment is calculated based on the average paid during the four calendar quarters immediately preceding the loss of the premises that prompted the relocation.
Fly Fitness may impose conditions for relocation, including loss of premises, demographics, proximity to other Fly Fitness outlets, lease requirements, traffic patterns, access, parking, and overall suitability. The franchisee must identify a new location meeting Fly Fitness's approval within 60 days, or Fly Fitness may terminate the Franchise Agreement.