What financial statements must a Fly Fitness developer submit to the franchisor?
Fly_Fitness Franchise · 2024 FDDAnswer from 2024 FDD Document
- Document, (ii) submit to Franchisor all information and other documents requested by Franchisor prior to and as a basis for the issuance of Franchise Agreements in the System, (iii) submit to Franchisor all financial statements reasonably requested by Franchisor, and (iv) satisfy Franchisor's then-current financial criteria for multiunit franchisees.
Source: Item 23 — RECEIPT (FDD pages 45–182)
What This Means (2024 FDD)
According to Fly Fitness's 2024 Franchise Disclosure Document, a developer must submit all financial statements reasonably requested by Fly Fitness. Additionally, the developer must satisfy Fly Fitness's current financial criteria for multi-unit franchisees. This requirement is part of the conditions that must be met for the developer to be granted rights to establish additional Fly Fitness Franchised Businesses.
This means that as a prospective Fly Fitness developer, you should be prepared to provide comprehensive financial documentation to the franchisor. The specific types of financial statements are not detailed, but Fly Fitness has the right to request any financial information they deem reasonably necessary. This could include balance sheets, income statements, cash flow statements, tax returns, and other relevant financial records.
Furthermore, Fly Fitness will assess these financial statements to ensure that you meet their financial criteria for operating multiple units. This evaluation is at Fly Fitness's discretion. If Fly Fitness determines that you do not meet the financial criteria or any other conditions, they can terminate the agreement, although this termination will not affect other agreements if the developer is in full compliance with them. Therefore, it is crucial to maintain open communication with Fly Fitness regarding financial expectations and to ensure that you can meet their requirements throughout the development schedule.