What constitutes a non-curable default that could lead to termination of the Body20 Development Agreement?
Body20 Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in Development Agreement | Summary | |
|---|---|---|---|
| e. | Termination by us without cause | Not applicable | Not applicable. |
| f. | Termination by us with cause | Section 6.1 | We have the right to terminate Development Agreement if you commit one of several violations. |
| g. | "Cause" defined – curable defaults | None | Not applicable. |
| h. | "Cause" defined – non curable defaults | Section 6.1 | Non-curable defaults include you (or your Affiliated Entities) fail to timely execute a Franchise Agreement; you (or your Affiliated Entities) fail to have open and operating the required number of Studios specified in the Development Schedule at any deadline; you, your Owners, or your affiliates breach or commit a default under any Franchise Agreement or other agreement with us or our affiliates, and we or our affiliates terminate that agreement or have the right to terminate that agreement, even if we do not exercise that right; or you, your Owners, or your affiliates breach or otherwise fail to comply with any other provision in the Development Agreement. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION (FDD pages 56–64)
What This Means (2025 FDD)
According to Body20's 2025 Franchise Disclosure Document, there are specific non-curable defaults that could lead to the termination of the Development Agreement. These defaults, as outlined in Section 6.1 of the Development Agreement, include several scenarios related to the franchisee's failure to meet critical obligations.
Specifically, a non-curable default occurs if the franchisee (or their Affiliated Entities) fails to execute a Franchise Agreement in a timely manner. Additionally, failing to have the required number of Body20 studios open and operating by the deadlines specified in the Development Schedule also constitutes a non-curable default. This means that Body20 franchisees must adhere strictly to the development timeline outlined in their agreement to avoid potential termination.
Furthermore, if the franchisee, their Owners, or their affiliates breach or default under any Franchise Agreement or other agreement with Body20 or its affiliates, and Body20 or its affiliates have the right to terminate that agreement, it is considered a non-curable default under the Development Agreement, regardless of whether Body20 actually exercises that termination right. Finally, any other breach or failure to comply with any provision in the Development Agreement by the franchisee, their Owners, or their affiliates also constitutes a non-curable default, giving Body20 grounds for termination.