What is considered a 'Competitive Business' according to the Body20 agreement?
Body20 Franchise · 2025 FDDAnswer from 2025 FDD Document
(a) own, manage, engage in, be employed by, advise, make loans to, lease or sublease space to, or have any other interest in (i) any gymnasium, studio, athletic or fitness center, health club, exercise, aerobics facility, or similar fitness or exercise facility or business, (ii) any business that offers fitness training or products, services, or classes or training sessions that are similar to those offered by a Studio, or (iii) any entity that grants franchises or licenses for any of the businesses in (i) or (ii) (collectively, each, a "Competitive Business") at any location in the United States;
(b) divert or attempt to divert any business or customer or potential business or customer of the Studio to any Competitive Business, by direct or indirect inducement or otherwise;
(c) perform, directly or indirectly, any other act injurious or prejudicial to the goodwill associated with the Marks and the System; or
(d) use any vendor relationship established through your association with us for any purpose other than to purchase products or equipment for use or retail sale in the Studio.
**5.
Noncompete After Association Ends.** For two years after your association with us ends for any reason, you will be subject to the same restrictions as in Section 4, except the restrictions in Sections 4(a) and 4(b) will be geographically limited to any Competitive Business that is located within a 10-mile radius of our Studio or any other Studio that is operating or under development at the time your association with us ends.
Source: Item 23 — RECEIPT (FDD pages 74–251)
What This Means (2025 FDD)
According to Body20's 2025 Franchise Disclosure Document, a 'Competitive Business' is defined within the context of noncompete covenants that apply both during the term of the agreement and for a period after association with Body20 ends. During the term of the agreement, franchisees and their owners are prohibited from engaging in or having any interest in certain types of businesses without prior written consent from Body20.
Specifically, a 'Competitive Business' includes (i) any gymnasium, studio, athletic or fitness center, health club, exercise, aerobics facility, or similar fitness or exercise facility or business, (ii) any business that offers fitness training or products, services, or classes or training sessions that are similar to those offered by a Body20 studio, or (iii) any entity that grants franchises or licenses for any of the businesses in (i) or (ii). This broad definition aims to prevent franchisees from directly competing with Body20 during the term of their agreement.
After the franchise agreement ends, the restrictions are similar but geographically limited. For two years after the association with Body20 ends, the franchisee is restricted from involvement with a Competitive Business within a 10-mile radius of their former Body20 studio or any other Body20 studio operating or under development. This post-term restriction is designed to protect Body20's market share and goodwill in specific local areas. The franchisee is also prohibited from diverting business or customers from Body20 to a competitive business, performing any act injurious to the goodwill associated with the Body20 marks and system, or using vendor relationships established through their association with Body20 for any purpose other than purchasing products or equipment for the Body20 studio.