What is Bft's obligation regarding granting licenses to others to develop studios within the Development Area, assuming the franchisee is in compliance?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
As long as you are in compliance with your Multi-Unit Agreement, we will not operate, or grant a license to a third-party to operate, during the term of your Multi-Unit Agreement, a Studio located within the Development Area, and we will not grant anyone else the right to develop Studios within the Development Area, subject to our reservation of rights below.
You must comply with your development obligations under the Multi-Unit Agreement, including your Development Schedule, in order to maintain your development rights within the Development Area. If you do not comply with your Development Schedule, we may terminate your Multi-Unit Agreement and any further development rights you have under that agreement. Otherwise, we will not modify the size of your Development Area except by mutual written agreement signed by both parties.
Source: Item 12 — TERRITORY (FDD pages 50–54)
What This Means (2025 FDD)
According to Bft's 2025 Franchise Disclosure Document, if a franchisee is in compliance with their Multi-Unit Agreement, Bft will not operate or grant a license to a third party to operate a studio within the Development Area during the term of the Multi-Unit Agreement. Furthermore, Bft will not grant anyone else the right to develop studios within the Development Area, subject to their reservation of rights. This indicates that Bft provides a level of territorial protection to multi-unit franchisees who are meeting their obligations under the agreement. This protection is subject to Bft's reserved rights, which are detailed elsewhere in the Franchise Disclosure Document.
However, the franchisee must comply with their development obligations under the Multi-Unit Agreement, including adhering to the Development Schedule, to maintain these development rights within the Development Area. Failure to meet the Development Schedule could result in the termination of the Multi-Unit Agreement and the loss of any further development rights. The size of the Development Area will not be modified unless both parties agree in writing.
This arrangement is designed to incentivize franchisees to actively develop their designated areas according to the agreed-upon schedule. It also protects the franchisee's investment by preventing Bft from oversaturating the market with additional franchises or company-owned locations within the Development Area, as long as the franchisee is meeting their contractual obligations. Prospective franchisees should carefully review the definition of "Development Schedule" and the implications of failing to meet those obligations.