Can Body20 decide not to complete the purchase of my Body20 studio after the purchase price is determined?
Body20 Franchise · 2025 FDDAnswer from 2025 FDD Document
We will pay the purchase price at the closing, which will take place within 60 days after the purchase price is determined, although we may decide after the purchase price is determined not to complete the purchase.
We may set off against the purchase price, and reduce the purchase price by, any and all amounts you owe us or our Affiliates.
We are entitled to all customary representations, warranties, and indemnities in our asset purchase, including (a) representations and warranties as to (i) ownership and condition of, and title to, assets, (ii) liens and encumbrances on assets, (iii) validity of contracts and agreements, and (iv) liabilities affecting the assets, contingent or otherwise, and (b) indemnities for all actions, events and conditions that existed or occurred in connection with the Studio or your business prior to the closing of our purchase.
At the closing, you agree to deliver instruments transferring to us: (x) good and merchantable title to the Purchased Assets, free and clear of all liens and encumbrances (other than liens and security interests acceptable to us), with all sales and transfer taxes paid by you; and (y) all of the Studio's licenses and permits which may be assigned or transferred.
If you cannot deliver clear title to all of the Purchased Assets, or if there are other unresolved issues, the sale will be closed through an escrow.
You and your Owners further agree to sign general releases, in a form satisfactory to us, of any and all claims (to the extent permitted by Applicable Laws) against us, our Affiliates, and our and their respective owners, officers, directors, employees, agents, representatives, successors, and assigns.
Source: Item 23 — RECEIPT (FDD pages 74–251)
What This Means (2025 FDD)
According to Body20's 2025 Franchise Disclosure Document, Body20 has the option to not complete the purchase of a Body20 studio even after the purchase price has been determined. The closing, where Body20 pays the purchase price, is scheduled to occur within 60 days after the purchase price is determined. However, Body20 retains the right to decide against completing the purchase during this period.
Body20 also has the right to offset against the purchase price any amounts that the franchisee owes to Body20 or its affiliates, effectively reducing the purchase price by the amount owed. In the asset purchase agreement, Body20 is entitled to customary representations, warranties, and indemnities, including assurances regarding the ownership, condition, and title of assets, as well as any liens, encumbrances, validity of contracts, and liabilities affecting the assets. The franchisee is required to provide instruments transferring clear title to the purchased assets, free of liens and encumbrances, and must pay all sales and transfer taxes.
Furthermore, the franchisee and their owners must sign general releases, in a form satisfactory to Body20, releasing any claims against Body20, its affiliates, and their respective owners, officers, directors, employees, agents, representatives, successors, and assigns. If the franchisee cannot deliver clear title to all purchased assets or if there are other unresolved issues, the sale will be closed through an escrow account. This clause provides Body20 with significant flexibility and protection in the event of unforeseen issues or changes in circumstances after the purchase price has been agreed upon.