What must a Body20 franchisee do to maintain their development rights?
Body20 Franchise · 2025 FDDAnswer from 2025 FDD Document
e or work or are otherwise based outside of your Territory if these customers contact you, but we reserve the right to implement additional rules and restrictions regarding soliciting such customers in the future in our Manuals.
Development Agreement
Development Area. You may (if you qualify) develop and operate a number of Studios within a specific territory (the "Development Area"). We and you will identify the Development Area in the Development Agreement before signing it. The Development Area typically is a city, cities, counties, or specific zip codes and will be narratively described in, and pictorially identified on a map attached to, the Development Agreement. We base the Development Area's size primarily on the number of Studios that you commit to develop, demographics, distinct market areas within the Development Area, competitive businesses, and site availability. We will determine the number of Studios that you must develop, and the deadlines for development, to keep your development rights. We and you will complete the Development Schedule in the Development Agreement before signing it. Each site you propose for a Studio to be developed under the Development Agreement must be acceptable to us. After each proposed site is accepted and secured, we will determine the Territory for that Studio. Our then-current standards for sites and Territories will apply. We have the right to terminate the Development Agreement if
you do not satisfy your development obligations. You may not develop or operate Studios outside the Development Area.
Limited Territorial Protection. You will not receive an exclusive territory under the Development Agreement. You may face competition from other franchisees, from outlets that we own, or from other channels of distribution or competitive brands that we control. 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.
The location exclusivity described in the preceding paragraph (with the noted exception for Non-Traditional Locations) is the only restriction on our (and our affiliates') activities within the Development Area during the term of the Development Agreement.
Source: Item 12 — TERRITORY (FDD pages 49–53)
What This Means (2025 FDD)
According to Body20's 2025 Franchise Disclosure Document, a franchisee who enters into a Development Agreement must adhere to a specific development schedule to maintain their development rights. Body20 determines the number of studios a franchisee must develop and the deadlines for that development. This information is documented in a Development Schedule within the Development Agreement, which is finalized before signing. Each proposed site must be acceptable to Body20, and after the site is secured, Body20 determines the territory for that studio, applying their current standards for sites and territories.
A significant risk for the franchisee is the potential termination of the Development Agreement if they fail to meet their development obligations. This underscores the importance of carefully considering the development schedule and ensuring that the franchisee has the resources and capabilities to meet those obligations. The Development Area, which is defined as a city, cities, counties, or specific zip codes, is determined based on the number of studios the franchisee commits to develop, demographics, market areas, competition, and site availability.
The Development Agreement does not grant an exclusive territory, meaning franchisees may face competition from other franchisees, company-owned outlets, or other distribution channels. However, Body20 will not establish or operate (or license others to do so) studios within the Development Area, except for studios in "Non-Traditional Locations," as long as the franchisee is fully compliant with all agreements. Non-Traditional Locations include venues like gyms, cruise ships, military bases, and airports.
If a franchisee defaults on the Development Agreement, Body20 has the option to modify the Development Area or the Development Schedule, reducing the number of studios required. However, the franchisee will not receive a refund for any portion of the development fee if such modifications occur due to a default. Therefore, franchisees should carefully evaluate their ability to meet the development obligations before entering into a Development Agreement with Body20.