Under the Fly Fitness agreement, what schedule must the Developer follow to open Franchised Businesses?
Fly_Fitness Franchise · 2024 FDDAnswer from 2024 FDD Document
en Franchisor and Developer. Developer hereby acknowledges and agrees that the training Developer receives pursuant
- to the initial Franchise Agreement executed concurrently with this Agreement is sufficient to allow Developer to construct, equip, open and operate each of Developer's Franchised Businesses in the Development Area.
- 5.2 Mandatory Development Schedule. Subsequent to Developer's signing of this Agreement and the initial Franchise Agreement, and provided that all conditions in Section 5.4 hereof are satisfied or waived, upon the execution of a lease for Developer's first Franchised Business, Developer shall execute an additional Franchise Agreement for the development of the second Franchised Business to be opened under the Mandatory Development Schedule. Provided that all conditions in Section 5.4 hereof are satisfied or waived, upon the execution of a lease for each subsequent Franchised Business to be developed by Developer, Developer shall execute an additional Franchise Agreement for the development of the next Franchised Business to be opened under the Mandatory Development Schedule. Notwithstanding the foregoing, Developer shall open the Franchised Businesses in accordance with the following schedule:
| Outlet for Development | Mandatory Open Date | | |------------------------|--------------------------------|--| | | months following the Effective | | | 1 | Date months following the Effective | | | 2 | Date months following the Effective | | | 3 | Date | | Developer acknowledges and agrees that the terms of the Mandatory Development Schedule are reasonable and viable based upon Developer's independent investigation and analysis. Failure by Developer to adhere to the Mandatory Development Schedule (including any extensions thereof approved by Franchisor in writing pursuant to Section 5.3 below) shall constitute a material event of default under this Agreement.
- 5.3 Extension of Mandatory Development Schedule. If Developer is unable to meet the Mandatory Development Schedule for any Franchised Business, Developer may seek a onetime six (6) month extension of the Mandatory Development Schedule from Franchisor. Any request for an extension must be in writing and submitted to Franchisor at least sixty (60) days prior to the Mandatory Open Date for such outlet. Franchisor shall not unreasonably withhold consent for such reasonable extension provided that Developer has (i) submitted its extension request in a timely manner; (ii) demonstrated diligent efforts to meet the original Mandatory Open Date;
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 adhere to a Mandatory Development Schedule for opening Franchised Businesses. After signing the Multi-Unit Development Agreement and the initial Franchise Agreement, the Developer must execute an additional Franchise Agreement for the second Fly Fitness location upon executing a lease for the first location. For each subsequent location, the Developer must execute another Franchise Agreement upon securing a lease for the respective location, adhering to the Mandatory Development Schedule.
The Fly Fitness FDD states that failure to comply with the Mandatory Development Schedule constitutes a material breach of the Multi-Unit Development Agreement. However, a Developer can request a one-time six-month extension by submitting a written request to Fly Fitness at least 60 days before the Mandatory Open Date. Fly Fitness will not unreasonably deny the extension if the Developer has made diligent efforts to meet the original schedule, acted in good faith, and fulfilled their other obligations.
Before Fly Fitness grants the Developer the right to develop an additional Franchised Business, the Developer must request Fly Fitness's current Franchise Disclosure Document. The Developer must also provide Fly Fitness with written evidence satisfactory to Fly Fitness that the Developer has sufficient capital, financing, and resources to construct, equip, open, and operate the Franchised Business. The Developer must be in compliance with the Multi-Unit Development Agreement and all Franchise Agreements entered into by the Developer, and the Developer must not be in default of any agreement with Fly Fitness or its affiliates.