Are the representations made to the franchisee in the Fly Fitness Franchise Disclosure Document disclaimed by the franchise agreement?
Fly_Fitness Franchise · 2024 FDDAnswer from 2024 FDD Document
anufacturer or distributor of certain products under the Marks licensed herein; and it is understood that Franchisor does not warrant that such products will not be sold within the Franchisee's (or Developer's) Territory by others who may have purchased such products from Franchisor.
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- BY EXECUTING THE FRANCHISE AGREEMENT (OR MULTI-UNIT DEVELOPMENT AGREEMENT), FRANCHISEE (OR DEVELOPER) AND ANY PRINCIPAL, INDIVIDUALLY AND ON BEHALF OF FRANCHISEE'S (OR DEVELOPER'S) AND SUCH PRINCIPAL'S HEIRS, LEGAL REPRESENTATIVES, SUCCESSORS AND ASSIGNS, HEREBY FOREVER RELEASE AND DISCHARGE FLY FITNESS FRANCHISE, L.L.C., FLY HOLDINGS LLC, AND ANY OF THE ABOVE'S PARENT COMPANY, SUBSIDIARIES, DIVISIONS, AFFILIATES, SUCCESSORS, ASSIGNS AND DESIGNEES, AND THE FOREGOING ENTITIES' DIRECTORS, OFFICERS, EMPLOYEES, AGENTS, SHAREHOLDERS, SUCCESSORS, DESIGNEES AND REPRESENTATIVES FROM ANY AND ALL CLAIMS, DEMANDS AND JUDGMENTS RELATING TO OR ARISING UNDER THE STATEMENTS, CONDUCT, CLAIMS OR ANY OTHER AGREEMENT BETWEEN THE PARTIES EXECUTED PRIOR TO THE DATE OF THE FRANCHISE AGREEMENT (OR MULTI-UNIT DEVELOPMENT AGREEMENT), INCLUDING, BUT NOT LIMITED TO, ANY AND ALL CLAIMS, WHETHER PRESENTLY KNOWN OR UNKNOWN, SUSPECTED OR UNSUSPECTED, ARISING UNDER THE FRANCHISE, SECURITIES, TAX OR ANTITRUST LAWS OF THE UNITED STATES OR OF ANY STATE OR TERRITORY THEREOF. THIS RELEASE SHALL NOT APPLY TO ANY CLAIMS ARISING FROM REPRESENTATIONS MADE BY FRANCHISOR IN FRANCHISOR'S FRANCHISE DISCLOSURE DOCUMENT RECEIVED BY FRANCHISEE (OR DEVELOPER).
| FRANCHISEE: | PRINCIPAL: | |---------------------|--------------| | By: | | | , | (Print Name) | | (Print Name, Title) | Date: | | Date: | PRINCIPAL: | | | | | | (Print Name) Date: |
EXHIBIT H STATE ADDENDA
ADDENDUM TO THE FRANCHISE DISCLOSURE DOCUMENT REQUIRED BY THE STATE OF MINNESOTA
The Commissioner of Commerce for the State of Minnesota requires that certain provisions contained in franchise documents be amended to be consistent with Minnesota Franchise Act, Minn. Stat. Section 80.01 et seq., and of the Rules and Regulations promulgated under the Act (collectively the "Franchise Act"). To the extent that the Agreement contains provisions that are inconsistent with the following, such provisions are hereby amended:
- Item 6, Non-Sufficient Funds Fee, is amended to state:
Pursuant to Minn. Stat. § 604.113, the Non-Sufficient Funds Fee is $30.00 per occurrence.
2. Item 17 is amended to state:
- (a) Minn. Stat. § 80C.21 and Minnesota Rules § 2860.4400(J) prohibit us from requiring litigation to be conducted outside Minnesota, requiring waiver of a jury trial, or requiring you to consent to liquidated damages, termination penalties or judgment notes. In addition, nothing in this Franchise Disclosure Document or agreement(s) shall abrogate or reduce (1) any of your rights as provided for in Minn. Stat. Chapter 80C or (2) your rights to any procedure, forum, or remedies provided for by the laws of the jurisdiction.
- (b)
Source: Item 22 — CONTRACTS (FDD pages 44–45)
What This Means (2024 FDD)
According to Fly Fitness's 2024 Franchise Disclosure Document, the franchise agreement does not disclaim representations made in the Franchise Disclosure Document (FDD). Specifically, the Franchise Agreement includes a clause releasing Fly Fitness from claims made prior to the agreement, but this release explicitly excludes claims arising from representations in the FDD. This means that a franchisee may have legal recourse based on statements made by Fly Fitness in the FDD.
Furthermore, the Fly Fitness Acknowledgment Statement, included as Exhibit G, reinforces this protection. It states that no statement signed by a franchisee can waive claims under state franchise law, including fraud in the inducement, or disclaim reliance on statements made by Fly Fitness or its representatives. This provision is explicitly stated to supersede any other conflicting terms in any document related to the franchise agreement.
This protection is a significant benefit for prospective Fly Fitness franchisees. It ensures that they can rely on the information provided in the FDD when making their investment decision. It also means that Fly Fitness is accountable for the accuracy and completeness of the information it provides to potential franchisees. This is a standard practice in franchising, as the FDD is intended to be a reliable source of information for franchisees to assess the opportunity.
However, the Fly Fitness Acknowledgment Statement also includes a clause where the franchisee acknowledges conducting an independent investigation of the business and waives any claims against Fly Fitness for business failure, except for representations made in the FDD. This highlights the importance of conducting thorough due diligence and understanding the risks involved in operating a Fly Fitness franchise. While the FDD provides important information, it is not a guarantee of success, and franchisees must rely on their own business acumen and efforts.