What conditions may Fly To Fit Franchise impose when granting consent for a transfer by the franchisee?
Fly_To_Fit Franchise · 2024 FDDAnswer from 2024 FDD Document
hout the consent of Franchisee.
- 15.2 By Franchisee. Franchisee acknowledges that the rights and duties set forth in this Agreement are personal to Franchisee and that Fly To Fit Franchise entered into this Agreement in reliance on Franchisee's business skill, financial capacity, personal character, experience, and business ability. Accordingly, Franchisee shall not conduct or undergo a Transfer without providing Fly To Fit Franchise at least 60 days prior notice of the proposed Transfer, and without obtaining Fly To Fit Franchise's consent. In granting any such consent, Fly To Fit Franchise may impose conditions, including, without limitation, the following:
- (i) Fly To Fit Franchise receives a transfer fee equal to $10,000 plus any broker fees and other out-of-pocket costs incurred by Fly To Fit Franchise;
- (ii) the proposed assignee and its owners have completed Fly To Fit Franchise's franchise application processes, meet Fly To Fit Franchise's then-applicable standards for new franchisees, and have been approved by Fly To Fit Franchise as franchisees;
- (iii) the proposed assignee is not a Competitor;
- (iv) the proposed assignee executes Fly To Fit Franchise's then-current form of franchise agreement and any related documents, which form may contain
- materially different provisions than this Agreement (provided, however, that the proposed assignee will not be required to pay an initial franchise fee);
- (v) all owners of the proposed assignee provide a guaranty in accordance with Section 2.5;
- (vi) Franchisee has paid all monetary obligations to Fly To Fit Franchise and its affiliates, and to any lessor, vendor, supplier, or lender to the Business, and Franchisee is not otherwise in default or breach of this Agreement or of any other obligation owed to Fly To Fit Franchise or its affiliates;
- (vii) the proposed assignee and its owners and employees undergo such training as Fly To Fit Franchise may require;
- (viii) Franchisee, its Owners, and the transferee and its owners execute a general release of Fly To Fit Franchise in a form satisfactory to Fly To Fit Franchise;
Source: Item 22 — CONTRACTS (FDD page 44)
What This Means (2024 FDD)
According to Fly To Fit's 2024 Franchise Disclosure Document, Fly To Fit has specific conditions it may impose when a franchisee wants to transfer their franchise. Fly To Fit requires at least 60 days' prior notice before a proposed transfer.
Fly To Fit may require a transfer fee of $10,000, in addition to any broker fees or out-of-pocket costs incurred by Fly To Fit. The proposed assignee must complete Fly To Fit's franchise application process, meet the standards for new franchisees, and be approved by Fly To Fit. The assignee cannot be a competitor. The assignee must also execute Fly To Fit's current franchise agreement, which may have materially different provisions, although the assignee won't have to pay an initial franchise fee. All owners of the proposed assignee must provide a guaranty.
Furthermore, the franchisee must have paid all monetary obligations to Fly To Fit, its affiliates, lessors, vendors, suppliers, or lenders, and not be in default of any agreements. The proposed assignee, along with their owners and employees, must undergo any required training. The franchisee, its owners, and the transferee and its owners must execute a general release of Fly To Fit in a satisfactory form, and the business must fully comply with Fly To Fit's most recent System Standards.