What must Body20 franchisees do to ensure their owners are bound by the non-compete agreement?
Body20 Franchise · 2025 FDDAnswer from 2025 FDD Document
You and your Owners must comply with the covenant not to compete in Section 12 (Noncompete Covenants) and the non-disparagement covenant in Section 17.12 (Non-Disparagement).
- 15.12 Injunctive and Other Relief.
You acknowledge that your failure to abide by the provisions of this Section 15 (Your Obligations Upon Expiration or Termination) will result in irreparable harm to us, and that our remedy at law for damages will be inadequate.
Accordingly, you agree that if you breach any provisions of this Section 15, we are entitled to injunctive relief (including the remedy of specific performance) in addition to any other remedies available at law or in equity.
Source: Item 23 — RECEIPT (FDD pages 74–251)
What This Means (2025 FDD)
According to Body20's 2025 Franchise Disclosure Document, franchisees and their owners must adhere to the non-compete covenant outlined in Section 12 and the non-disparagement covenant in Section 17.12 of the franchise agreement. This means that both the franchisee entity and the individuals who own a legal or beneficial interest in that entity are legally obligated to refrain from competing with Body20 during the term of the franchise agreement and for a specified period afterward, as well as from making disparaging remarks about the franchise.
Failure to comply with these covenants can result in significant legal repercussions for Body20 franchisees. Specifically, Body20 is entitled to seek injunctive relief, including specific performance, to prevent further breaches of the non-compete and non-disparagement clauses. This means a court could order the franchisee or its owners to cease the prohibited activity immediately. Additionally, Body20 can pursue other remedies available under the law or in equity, which may include monetary damages to compensate for the harm caused by the breach.
To ensure compliance and avoid potential legal issues, Body20 franchisees should carefully review Sections 12 and 17.12 of their Franchise Agreement to fully understand the scope and terms of the non-compete and non-disparagement covenants. Franchisees should also ensure that all owners of the franchisee entity are aware of these obligations and understand the potential consequences of non-compliance. It is advisable for franchisees to consult with legal counsel to clarify any ambiguities and to implement internal procedures to monitor and enforce these covenants effectively.