What rights does Fly Fitness reserve regarding merging with or acquiring another business?
Fly_Fitness Franchise · 2024 FDDAnswer from 2024 FDD Document
We reserve all rights not expressly granted in the Franchise Agreement. For example, we or our affiliates may own, operate, or authorize others to own or operate Fly Fitness outlets outside of the Territory and may operate other kinds of businesses within the Territory. Although we do not currently do so and have no plans to do so, we and our affiliates may own, acquire, conduct, or authorize others to conduct, any form of business at any location selling any type of product or service not offered under the Marks, including a product or service similar to those you will sell at your Franchised Business. We reserve the right to merge with, acquire, or be acquired by, an existing competitive or non-competitive franchise network, chain, or other business; however, we will not convert any acquired business in your Territory to a franchise using our primary trademarks during the Term of your Franchise Agreement.
Source: Item 12 — TERRITORY (FDD pages 29–31)
What This Means (2024 FDD)
According to Fly Fitness's 2024 Franchise Disclosure Document, Fly Fitness retains specific rights regarding mergers and acquisitions. Fly Fitness reserves the right to merge with, acquire, or be acquired by another business, even if that business is a competitive or non-competitive franchise network, chain, or other business.
However, Fly Fitness makes one key commitment to its franchisees: it will not convert any acquired business located within a franchisee's territory into a Fly Fitness franchise using Fly Fitness's primary trademarks during the term of the existing franchisee's Franchise Agreement. This provides a degree of protection to the franchisee, ensuring that an acquired business within their territory will not immediately become a direct competitor operating under the Fly Fitness brand.
This reservation of rights is typical in franchise agreements, as it allows Fly Fitness to adapt to changing market conditions and pursue growth opportunities through mergers and acquisitions. While Fly Fitness retains this flexibility, the commitment not to convert acquired businesses to Fly Fitness franchises within a franchisee's territory offers some assurance that their investment will not be immediately undermined by a newly acquired competitor operating under the same brand.