For how long after the termination of a Body20 franchise agreement are franchisees restricted from engaging in competitive activities?
Body20 Franchise · 2025 FDDAnswer from 2025 FDD Document
- 12.2 After Termination, Expiration, or Transfer. For two years after the expiration or termination of this Agreement or an approved Transfer to a new franchisee, you and your Owners will be subject to the same restrictions as in Section 12.1 (During Term), except the restrictions in Section 12.1(a) and 12.1(b) shall be geographically limited to any Competitive Business that is located within a 10-mile radius of your former Studio or any other Studio that is operating or under development at the time of such expiration, termination, or Transfer. With respect to the Owners, the time period in this Section 12.2 will run from the expiration, termination, or Transfer of this Agreement or from the termination of the Owner's relationship with you, whichever occurs first.
Source: Item 23 — RECEIPT (FDD pages 74–251)
What This Means (2025 FDD)
According to the 2025 Body20 Franchise Disclosure Document, franchisees and their owners face certain restrictions regarding competitive activities both during the term of the franchise agreement and after its termination, expiration, or transfer.
For a period of two years following the expiration, termination, or transfer of the Body20 franchise agreement, franchisees and their owners are subject to restrictions similar to those in place during the term of the agreement. These restrictions prevent them from engaging in activities that could harm Body20's business interests. However, the restrictions on owning, managing, engaging in, being employed by, advising, making loans to, or leasing space to a competitive business, as well as diverting business or customers, are geographically limited. These limitations apply only to competitive businesses located within a 10-mile radius of the former Body20 studio or any other Body20 studio operating or under development at the time of termination, expiration, or transfer.
For owners, the two-year restriction period begins either from the expiration, termination, or transfer of the franchise agreement or from the termination of the owner's relationship with the franchisee, whichever occurs first. This ensures that owners cannot circumvent the non-compete obligations by simply ending their association with the franchisee before the agreement expires or is terminated.
These non-compete clauses are fairly standard in the franchise industry to protect the brand and prevent franchisees from using the franchisor's confidential information and training to unfairly compete after leaving the system.