What additional actions are required by each party under the Best Brains Option Agreement?
Best_Brains Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee shall pay to Franchisor, at the time of execution of this Agreement, a nonrefundable deposit of $2,500 for the rights described in Section 1 above. If Franchisee secures a lease for a Center location and new Franchise Agreement for that location, then the $2,500 shall be considered a deposit against the initial franchise fee on the new territory. If a Center location and new Franchise Agreement are not obtained in the 90 day period, then the $2,500 payment to Franchisor is nonrefundable as consideration for its rights given up under this Option Agreement.
If a franchise prospect that Franchisor feels is qualified expresses an interest in any Franchisor territory covered by this Option Agreement, within the Deposit Period, Franchisor may serve written notice upon Franchisee of its cancellation of this Option Agreement as to such territory and shall, at the same time, refund the $2,500 paid to Franchisee and then Franchisor may sell the franchise territory to the other prospect with no further obligation to Franchisee.
Each party shall, at the request of the other, execute, acknowledge (if appropriate) and deliver whatever additional documents, and do such other acts, as may be reasonably required in order to accomplish the intent and purposes of this Option Agreement.
Franchisee may not assign any of its rights under this Option Agreement to another person or entity. Franchisor may assign its rights under this Option Agreement to a third party who agrees to remain bound to the terms of this Option Agreement.
This Option Agreement shall be subject to the Governing Law and Dispute Resolution provisions in the most recent Franchise Agreement between the parties.
Source: Item 23 — RECEIPTS (FDD pages 42–190)
What This Means (2025 FDD)
According to Best Brains' 2025 Franchise Disclosure Document, the Option Agreement outlines specific actions required by both the franchisee and franchisor. The franchisee is obligated to pay a nonrefundable deposit of $2,500 to Best Brains upon execution of the agreement. This deposit grants the franchisee a 90-day period to secure a lease for a center location and obtain a new Franchise Agreement for the potential new territory. If the franchisee successfully secures a lease and a new Franchise Agreement within this 90-day period, the $2,500 deposit will be credited towards the initial franchise fee for the new territory. However, if the franchisee fails to obtain a center location and a new Franchise Agreement within the stipulated 90-day period, Best Brains retains the $2,500 as consideration for the rights given up under the Option Agreement.
Best Brains, as the franchisor, has the right to cancel the Option Agreement under certain conditions. Specifically, if Best Brains receives interest from another qualified franchise prospect for any territory covered by the Option Agreement during the 90-day deposit period, Best Brains can provide written notice to the franchisee, cancel the Option Agreement for that specific territory, and refund the $2,500 deposit. Following this cancellation and refund, Best Brains is free to sell the franchise territory to the new prospect without any further obligation to the original franchisee who held the Option Agreement.
Additionally, both parties are expected to fulfill further acts as reasonably required to accomplish the intent and purposes of the Option Agreement. This includes executing and delivering additional documents as requested by the other party. Neither party can assign their rights under the Option Agreement, except that Best Brains may assign its rights to a third party who agrees to be bound by the terms of the agreement. The Option Agreement is governed by the same Governing Law and Dispute Resolution provisions as the most recent Franchise Agreement between the parties.