What is the purpose of the Development Schedule exhibit in the Punch King Fitness Area Development Agreement?
Punch_King_Fitness Franchise · 2024 FDDAnswer from 2024 FDD Document
ights to use the Marks are granted only by Franchise Agreements.
II. FEES
The total amount of the Development Fee is listed in Exhibit 2 (the "Development Fee"). The Development Fee will be applied toward the initial franchise fee due under subsequent Franchise Agreements in the manner specified in Exhibit 2. Developer will pay the balance of the initial franchise fee as so stipulated and due under the then Current Franchise Agreement for each Franchised Business at the time the Franchise Agreement for each Franchised Business is executed. The Development Fee will not be refundable, notwithstanding anything to the contrary in this Agreement or any Franchise Agreement.
III. DEVELOPMENT SCHEDULE
Developer must enter into Franchise Agreements and open and operate Punch King Fitness Franchised Business in accordance with the deadlines set forth in the Development Schedule. By each "Fee Deadline" specified in the Development Schedule, Developer must have delivered to Franchisor an initial franchise fee and a signed copy of Franchisor's then-current standard form of Franchise Agreement for the number of Punch King Fitness Franchised Businesses specified on the Development Schedule. By each "Opening Deadline" specified in the Development Schedule, Developer must have the specified number of Punch King Fitness Franchised Businesses open and operating. Developer must locate the
Punch King Fitness Franchised Businesses only at sites that Franchisor has accepted in accordance with the terms of the applicable Franchise Agreement.
IV. DEVELOPMENT AREA
**A.
Source: Item 22 — CONTRACTS (FDD pages 56–215)
What This Means (2024 FDD)
According to the 2024 Punch King Fitness Franchise Disclosure Document, the Development Schedule outlines the specific deadlines and requirements that an area developer must meet to maintain their development rights. The developer is obligated to enter into Franchise Agreements and open Punch King Fitness locations according to the schedule.
The Development Schedule specifies "Fee Deadlines," by which the developer must submit the initial franchise fee and a signed Franchise Agreement for a certain number of locations. It also lists "Opening Deadlines," by which the developer must have a specified number of Punch King Fitness locations open and operating. The franchisor must approve the sites for these locations according to the terms of the Franchise Agreement.
Failure to meet these deadlines can result in a default under the Area Development Agreement, potentially leading to termination of the agreement and loss of development rights. However, as long as the developer adheres to the Development Schedule and maintains the minimum required number of open locations, Punch King Fitness will not establish or license another party to establish the same Punch King Fitness Model Concept within the designated Development Area. This exclusivity is limited, as Punch King Fitness retains the right to establish or license different Punch King Fitness Model Concepts, such as co-branded or virtual outlets, within the same area.