Can the Fly Fitness franchisor withhold acceptance of the General Manager?
Fly_Fitness Franchise · 2024 FDDAnswer from 2024 FDD Document
- 11.4.4 If either the Operating Principal or the General Manager is not able to continue to serve in such capacity, or no longer qualifies to act as such in accordance with this Agreement, Franchisee shall promptly notify Franchisor and designate a replacement within thirty (30) days after the Operating Principal or the General Manager, as the case may be, ceases to serve, such replacement being subject to the same qualifications required by this Agreement (including, but not limited to, completing all training and obtaining all certifications required by Franchisor).
Until such replacement is designated, Franchisee shall provide for interim management of the Franchised Business, who shall act in accordance with the terms of this Agreement.
Any failure to comply with the requirements of this Section shall be deemed a material event of default under this Agreement.
Franchisor, in Franchisor's sole discretion, may provide interim management support and charge Franchisee the thencurrent interim management support fee until a replacement Operating Principal or General Manager is properly trained or certified in accordance with Franchisor's requirements.
Franchisee shall pay the interim management support fee, plus any and all costs of travel, lodging, meals, and other expenses reasonably incurred by Franchisor, upon written demand by Franchisor, or Franchisor may withdraw such amounts from Franchisee's designated bank account in accordance with Section 6.1.4.
Source: Item 22 — CONTRACTS (FDD pages 44–45)
What This Means (2024 FDD)
According to Fly Fitness's 2024 Franchise Disclosure Document, the franchisor has specific requirements regarding the General Manager of a franchised location. If the current General Manager is no longer able to serve or no longer qualifies according to the Franchise Agreement, the franchisee must notify Fly Fitness and designate a replacement within thirty days. This replacement must meet all qualifications outlined in the agreement, including completing required training and obtaining necessary certifications.
During the period before a replacement General Manager is appointed, the franchisee is responsible for providing interim management that adheres to the terms of the agreement. Failure to comply with these requirements is considered a material breach of the agreement. Fly Fitness, at its discretion, can provide interim management support and charge the franchisee a fee, along with associated travel and lodging expenses, until a qualified replacement is in place. These charges can be directly withdrawn from the franchisee's bank account.
This clause ensures that Fly Fitness maintains a certain standard of management and operation across all its franchise locations. It also protects Fly Fitness by allowing them to step in and provide management support, ensuring continuity and adherence to brand standards, although at the franchisee's expense. A prospective franchisee should consider these potential costs and the importance of having qualified management in place to avoid any disruptions or additional fees.