If the Body20 franchisee is not in compliance with the agreement at the time of requesting a transfer, can they still proceed with the transfer?

According to Body20's 2025 Franchise Disclosure Document, a franchisee's ability to transfer their franchise while not in compliance with the franchise agreement depends on making satisfactory arrangements with Body20. Specifically, as of the date of the request for approval of the transfer, the franchisee and their affiliates must not be in default of any provision of the Franchise Agreement or related agreements.

However, Body20 allows for a conditional path forward. The franchisee can still proceed with the transfer if they make arrangements that are satisfactory to Body20 to come into compliance by the date of the transfer. This implies that the franchisee must address any outstanding issues or defaults to Body20's satisfaction before the transfer can be finalized.

In addition to resolving any defaults, the franchisee must also meet other conditions for the transfer, including paying the transfer fee, ensuring all monetary and other obligations to Body20 and its affiliates are up to date, and executing a general release of claims against Body20. The proposed transferee must also meet Body20's qualifications to become a franchisee, including successfully completing the training requirements and agreeing to operate the studio under Body20's system standards.