Can a Fly To Fit franchisee establish additional outlets within their territory?
Fly_To_Fit Franchise · 2024 FDDAnswer from 2024 FDD Document
to circumstances beyond your control.
You do not have the right to establish additional franchised outlets unless you sign a Multi-Unit Development Agreement ("MUDA") in the form attached as Exhibit C to this disclosure document. If you and we sign a MUDA, then you will have the right to establish a mutually-agreed number of additional outlets on a mutually-agreed schedule. Under the MUDA, your right to develop additional outlets is subject to (1) you must comply with the mutually-agreed development schedule, (2) you must have sufficient financial and organizational capacity to develop, open, operate, and manage each additional Fly To Fit business, (3) you must be in compliance with all brand requirements at your open Fly To Fit business(es), and (4) you must not be in default under any other agreement with us. We will approve the location of future sites and territories for those sites, and our then-current standards for sites and territories will apply. You are not obligated to develop additional outlets under the MUDA, and you may terminate it any time without penalty. If you do not meet your development schedule in the MUDA, we have the right to terminate your right to develop additional outlets.
Options to Acquire Additional Franchises
You do not receive any options, rights of first refusal, or similar rights to acquire additional franchises.
Source: Item 12 — TERRITORY (FDD pages 30–31)
What This Means (2024 FDD)
According to Fly To Fit's 2024 Franchise Disclosure Document, franchisees do not automatically have the right to establish additional franchised outlets. However, a Fly To Fit franchisee can gain the right to establish additional outlets if they sign a Multi-Unit Development Agreement (MUDA) with Fly To Fit. This agreement, outlined in Exhibit C of the FDD, allows the franchisee to establish a mutually-agreed number of additional outlets based on a mutually-agreed schedule.
Under the MUDA, the franchisee's right to develop additional Fly To Fit outlets is contingent upon several factors. These include compliance with the development schedule, having sufficient financial and organizational capacity to manage each new business, adhering to all brand requirements at existing Fly To Fit locations, and remaining in compliance with all agreements with Fly To Fit. The franchisor retains approval rights over the locations and territories of these future sites, ensuring they meet the then-current standards.
It's important to note that franchisees are not obligated to develop additional outlets under the MUDA and can terminate the agreement at any time without penalty. However, if a franchisee fails to meet the development schedule outlined in the MUDA, Fly To Fit has the right to terminate the franchisee's right to develop further outlets. Furthermore, the FDD states that franchisees do not receive any options, rights of first refusal, or similar rights to acquire additional franchises outside of a MUDA.