Must a buyer of a Fly To Fit franchise meet certain standards to be approved for transfer?
Fly_To_Fit Franchise · 2024 FDDAnswer from 2024 FDD Document
sclosure Document. |
| Provision | Section in franchise or other agreement | Summary |
|---|---|---|
| than 5 consecutive days; three defaults in 12 months; cross-termination; charge or conviction of, or plea to a felony, or commission or accusation of an act that is reasonably likely to materially and unfavorably affect our brand; any other breach of franchise agreement which by its nature cannot be cured. MUDA: failure to meet development schedule; violation of franchise agreement or other agreement which gives us the right to terminate it. | ||
| i. Franchisee's obligations on termination/non renewal | FA: §§ 14.3 – 14.6 MUDA: none | Pay all amounts due; return Manual and proprietary items; notify phone, internet, and other providers and transfer service; cease doing business; remove identification; purchase option by us. |
| j. Assignment of agreement by franchisor | FA: § 15.1 MUDA: § 7 | Unlimited |
| k. "Transfer" by franchisee - defined | FA: Article 1 MUDA: Background Statement | For you (or any owner of your business) to voluntarily or involuntarily transfer, sell, or dispose of, in any single or series of transactions, (i) substantially all of the assets of the business, (ii) the franchise agreement, (iii) any direct or indirect ownership interest in the business, or (iv) control of the business. |
| l. Franchisor's approval of transfer by franchisee | FA: § 15.2 MUDA: § 7 | No transfers without our approval. |
| m. Conditions for franchisor's approval of transfer | FA: § 15.2 MUDA: none | Pay transfer fee; buyer meets our standards; buyer is not a competitor of ours; buyer and its owners sign our then-current franchise agreement and related documents (including personal guaranty); you've made all payments to us and are in compliance with all contractual requirements; buyer completes training program; you sign a general release; business complies with then-current system specifications (including remodel, if applicable). |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION THE FRANCHISE RELATIONSHIP (FDD pages 35–39)
What This Means (2024 FDD)
According to Fly To Fit's 2024 Franchise Disclosure Document, if a franchisee wishes to transfer their franchise to a new owner, the buyer must meet certain standards to be approved by Fly To Fit. Specifically, Fly To Fit must give its approval before a transfer can occur.
The conditions for Fly To Fit's approval include several requirements for the buyer. The buyer must meet Fly To Fit's standards, and the buyer cannot be a competitor of Fly To Fit. Furthermore, the buyer and its owners must sign Fly To Fit's then-current franchise agreement and related documents, including a personal guaranty. The buyer must also complete the training program that Fly To Fit requires.
In addition to the buyer-specific requirements, the transferring franchisee must also meet certain obligations. The franchisee must have made all payments due to Fly To Fit and be in compliance with all contractual requirements. The franchisee must also sign a general release. Finally, the Fly To Fit business must comply with the then-current system specifications, which may include remodeling if applicable. These stipulations ensure that any new franchisee is well-prepared and that the business maintains Fly To Fit's standards and reputation.