What is the effect of complying with all obligations under the Body20 Development Agreement?
Body20 Franchise · 2025 FDDAnswer from 2025 FDD Document
If you (and your Affiliated Entities, as applicable) are fully complying with your (and their) obligations under the Development Agreement, the initial franchise agreement executed thereunder, and all other franchise agreements then in effect between us and you (and your Affiliated Entities, as applicable), during the term of the Development Agreement, we (and our affiliates) will not except with respect to Studios proposed to be located at or within "Non-Traditional Locations" establish or operate, or license third parties to establish or operate, Studios that have their physical locations within the Development Area. There are no other restrictions on our and our affiliates' activities in the Development Area during the term of the Development Agreement. We (and our affiliates) reserve the right without any restrictions whatsoever to pursue and establish, or franchise or license others to pursue and establish, Studios to be located at or within Non-Traditional Locations having their physical locations within the Development Area.
Source: Item 12 — TERRITORY (FDD pages 49–53)
What This Means (2025 FDD)
According to Body20's 2025 Franchise Disclosure Document, if a franchisee (and their Affiliated Entities) fully complies with all obligations under the Development Agreement, the initial franchise agreement executed under it, and all other franchise agreements in effect between them and Body20 (and its affiliates), Body20 (and its affiliates) will not establish or operate, or license third parties to do so, Body20 studios within the Development Area. This protection does not apply to studios proposed for or located at Non-Traditional Locations. Non-Traditional Locations include venues like big box gyms, cruise ships, military bases, college campuses, airports, and other similar captive market locations.
This limited territorial protection is the only restriction on Body20's activities within the Development Area during the term of the Development Agreement. Body20 and its affiliates retain the right to engage in any other activities within the Development Area, including those activities they reserve the right to engage in within a Studio's Territory under Section 1.3 of the Franchise Agreement.
If a franchisee defaults on the Development Agreement, Body20 may modify the Development Area or the Development Schedule to decrease the number of studios required to be developed. This modification can be done unilaterally with written notice to the franchisee, effective immediately. If Body20 reduces the Development Area or Schedule due to a default, the franchisee will not receive a refund of any portion of the Development Fee. Therefore, it is crucial for franchisees to meet all obligations to maintain their development rights and avoid potential penalties.