For a Body20 Control Transfer, what instruments must the franchisee and owners execute to evidence their liability?
Body20 Franchise · 2025 FDDAnswer from 2025 FDD Document
pproval of the Transfer (or you must make arrangements satisfactorily to us to come into compliance by the date of the Transfer) and (ii) the date of the Transfer;
- (d) You and your Owners must execute a general release, in a form that we prescribe, of any and all claims (to the extent permitted by Applicable Laws) against us, our Affiliates, and our and our Affiliates' past, present, and future officers, directors, mangers, members, equity holders, agents, and employees, including claims arising under Applicable Laws;
- (e) You and your Owners must agree to remain liable for all of the obligations to us in connection with the Studio arising before the effective date of the Transfer and execute any and all instruments that we reasonably request to evidence such liability;
Source: Item 23 — RECEIPT (FDD pages 74–251)
What This Means (2025 FDD)
According to Body20's 2025 Franchise Disclosure Document, in the event of a control transfer, both the franchisee and their owners must agree to remain liable for all obligations to Body20 in connection with the studio arising before the effective date of the transfer. To evidence this liability, they must execute any and all instruments that Body20 reasonably requests. Additionally, the franchisee, its owners, and the new transferee must execute a consent to Transfer agreement in a form prescribed by Body20, which outlines the conditions for obtaining consent to the transfer.
Furthermore, the proposed transferee (or owners, if the transferee is not an individual) must enter into a written assignment, in a form satisfactory to Body20, assuming and agreeing to discharge and guarantee all of the obligations of the franchisee under the Franchise Agreement. They must also execute Body20's then-current form of personal guarantee.
These requirements ensure that Body20 is protected against any liabilities or obligations that may arise before the transfer of ownership. It also ensures that the new owners are fully aware of their responsibilities and obligations as franchisees. Prospective franchisees should carefully review these requirements and seek legal counsel to fully understand the implications of a control transfer.