Is Bath Tune Up allowed to affix the Equipment to real property?
Bath_Tune_Up Franchise · 2025 FDDAnswer from 2025 FDD Document
3.3 Equipment Covenants
With respect to the Inventory:
- (f) the Equipment is now and shall remain personal property and Pledgor shall not permit any of the Equipment to be or become a part of or affixed to real property, and
Source: Item 22 — CONTRACTS (FDD page 52)
What This Means (2025 FDD)
According to the 2025 Bath Tune Up Franchise Disclosure Document, the franchisee (referred to as "Pledgor" in this section) is explicitly prohibited from allowing any equipment to become part of or affixed to real property.
This stipulation ensures that the equipment remains personal property and is not considered a permanent fixture of any real estate. This is a common clause in franchise agreements involving equipment, as it protects the franchisor's or a secured party's interest in the equipment as collateral or leased property.
For a Bath Tune Up franchisee, this means that all equipment used in the business must remain movable and not permanently attached to any building or land. Failure to comply with this covenant could potentially lead to a breach of the franchise agreement and possible legal repercussions.