If Body20 loans money to the Brand Fund, how will the loan be repaid?
Body20 Franchise · 2025 FDDAnswer from 2025 FDD Document
We or one of our affiliates may make or otherwise arrange loans to the Brand Fund in any year in which the balance of the Brand Fund is negative and charge a reasonable rate of interest. The amounts loaned to the Brand Fund will be repaid from future contributions to the Brand Fund in the year the loan is made or in subsequent years.
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS, AND TRAINING (FDD pages 38–49)
What This Means (2025 FDD)
According to Body20's 2025 Franchise Disclosure Document, if the Brand Fund has a negative balance, Body20 or its affiliates may loan money to the fund and charge a reasonable interest rate. These loans will be repaid from future contributions to the Brand Fund, either in the year the loan was made or in subsequent years. Franchisees contribute up to 4% of Gross Sales to the Brand Fund (currently 2%).
This means that a portion of the franchisee's ongoing contribution to the Brand Fund will be used to repay any loans made by Body20 or its affiliates, plus interest. The repayment will come directly from the franchisee's contribution to the Brand Fund.
It is important for prospective Body20 franchisees to understand that while the Brand Fund is intended to support the brand's marketing and promotional efforts, a portion of their contributions may be diverted to repay loans if the fund runs a deficit. Franchisees should inquire about the Brand Fund's financial history and policies regarding loans to the fund to fully understand the potential impact on their contributions.