What is the Punch King Fitness franchisee's obligation regarding the location of the Site?
Punch_King_Fitness Franchise · 2024 FDDAnswer from 2024 FDD Document
- 1. Within 1 month after the execution of the Franchise Agreement (the Site Selection Period), Franchisee shall acquire or lease, at Franchisee's expense, a location for the Punch King Fitness Franchised Business franchised under the Franchise Agreement (the Franchised Business) at a site approved by Franchisor as hereinafter provided.
Such location shall be within the following area: ________________________________ (the Site Selection Territory).
The Site Selection Territory is described solely for the purpose of selecting a site for the Franchised Business.
2. Franchisor shall not establish nor license another to establish; a Punch King Fitness Franchised Business within the Site Selection Territory until Franchisor approves of a location for the Franchised Business or until the expiration of the Site Selection Period, whichever event occurs first.
3. Failure by Franchisee to acquire or lease a site for the Franchised Business within the Site Selection Period shall constitute a default of the Franchise Agreement and this Site Selection Addendum.
4. If Franchisee occupies the Site of the Franchised Business under a lease or sublease, Franchisee shall, prior to the execution thereof, submit such lease to Franchisor for its written approval.
Franchisor's approval of the lease or sublease may be conditioned upon the inclusion of such provisions as Franchisor may reasonably require, including, without limitation:
(a) A provision that restricts the use of the Site solely to the operation of the Franchised Business;
(b) The lessor will consent to Franchisee's use of such Marks and signage as Franchisor may prescribe for the Franchised Business;
Source: Item 22 — CONTRACTS (FDD pages 56–215)
What This Means (2024 FDD)
According to Punch King Fitness's 2024 Franchise Disclosure Document, the franchisee has specific obligations regarding the location of their Franchised Business. Within one month of signing the Franchise Agreement, the franchisee must secure a location, either by purchasing or leasing, for their Punch King Fitness studio. This location must be within a designated Site Selection Territory, which is defined in the Franchise Agreement. The purpose of this territory is solely for selecting the site.
Punch King Fitness does not allow the franchisee to operate without an approved site. The franchisor will not establish or license another Punch King Fitness franchise within the Site Selection Territory until a location is approved or the Site Selection Period expires. Failure to secure a site within the one-month Site Selection Period constitutes a default of the Franchise Agreement and the Site Selection Addendum.
If the franchisee leases the site, the lease must be submitted to Punch King Fitness for written approval before it is finalized. Punch King Fitness may require specific provisions in the lease, such as restricting the site's use solely to the operation of the Punch King Fitness franchise and ensuring the lessor consents to the franchisee's use of Punch King Fitness's marks and signage. These stipulations ensure that the location aligns with Punch King Fitness's brand standards and operational requirements.