What is the Punch King Fitness franchisee's responsibility regarding selling within the Territory?
Punch_King_Fitness Franchise · 2024 FDDAnswer from 2024 FDD Document
default of this Agreement, which may, among other things, be grounds for the termination of this Agreement.
Franchisee may not and is not granted the right to use other channels of distribution, such as the internet, catalog sales, telemarketing, or other direct marketing, to make sales outside of your Territory or operate using other Model Concepts unless we give you written consent to serve another specified area where no other Punch King Fitness franchise or company-owned unit is located. Franchisee acknowledges and agrees to obtain the prior written consent of Franchisor before advertising, offering, or selling beyond the aforementioned grant herein. If Franchisee is granted consent to service another specified area, Franchisee covenants and agrees to be obligated to pay royalty fees and other fees to Franchisor for the services performed or products sold.
B. Franchisor Restrictions
Provided that Franchisee is in compliance with this Agreement and Franchisee is not in breach of this Agreement, and so long as Franchisee meets the Minimum Performance Standards as set forth in this Agreement, subject to the limitation, and except as otherwise set forth herein, Franchisor shall not establish or franchise another to establish the same Punch King Fitness Model Concept under the Punch King Fitness Marks within the Territory during the Term of this Agreement. If, for any reason, the boundaries of the Territory are moved, altered, or eliminated, Franchisor shall re-define the boundaries of the Territory to correspond as nearly as possible, in Franchisor's discretion, to Franchisee's original Territory and Franchisor's decision shall be final and binding upon both Franchisor and Franchisee. Franchisor is not obligated to ensure that no other franchise will conduct operations in your Territory.
Source: Item 22 — CONTRACTS (FDD pages 56–215)
What This Means (2024 FDD)
According to Punch King Fitness's 2024 Franchise Disclosure Document, a franchisee is restricted from using alternative distribution methods like the internet, catalogs, telemarketing, or direct marketing to make sales outside of their designated territory. They also cannot operate using other Model Concepts without explicit written consent from Punch King Fitness.
Before advertising, offering, or selling outside of their territory, a franchisee must obtain prior written consent from Punch King Fitness. If consent is granted to service another area, the franchisee is obligated to pay royalty fees and other fees to Punch King Fitness for the services performed or products sold in that area.
Punch King Fitness retains specific rights, including the ability to sell services and products through various channels and Model Concepts, such as storefronts, co-branded outlets, pop-up locations, virtual platforms, mobile units, joint marketing efforts, direct mail, internet sites, and co-branding strategies. They can also advertise and market goods or services using their marks over the Internet or any other electronic network. These rights are not expressly granted to the franchisee and are reserved by Punch King Fitness.