What happens to the Body20 studio's licenses and permits during the closing?

According to the 2025 Body20 Franchise Disclosure Document, if Body20 purchases a franchisee's studio, the franchisee must transfer all assignable or transferable licenses and permits to Body20 at the closing. The franchisee is also responsible for paying all sales and transfer taxes associated with transferring the licenses and permits. This transfer is part of delivering good and merchantable title to the purchased assets.

This requirement ensures that Body20 can continue operating the studio without interruption if they choose to purchase it. It also places the onus on the franchisee to ensure that all licenses and permits are in good standing and transferable, which could involve some administrative work and potential costs for the franchisee prior to the closing.

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 provides a mechanism to ensure that the transfer of licenses and permits, along with other assets, is properly handled before the franchisee receives the purchase price. This protects Body20 from acquiring a studio with outstanding legal or administrative issues, while also providing a safeguard for the franchisee.

Franchisees should be aware of this requirement and ensure they maintain accurate records of all licenses and permits associated with their Body20 studio. They should also consult with legal counsel to ensure a smooth transfer process and compliance with all applicable regulations.