What is the meaning of 'Territory' in the Body20 Franchise Agreement?
Body20 Franchise · 2025 FDDAnswer from 2025 FDD Document
independent contractor, or other third party. We will, however, remain responsible for ensuring that those obligations are performed in compliance with the terms of the Franchise Agreement.
ITEM 12 TERRITORY
Franchise Agreement
Site. Your franchise is for the specific Site that we approve. You must select a site that we have accepted within the non-exclusive Site Selection Area that we specify. Your Site Selection Area is not exclusive and is only intended to give you a general indication of the area within which you may locate the Site for the Studio. The site will be added to the Franchise Agreement once we accept it and you secure it.
Limited Territorial Protection. Once you have selected, and we have accepted, a Site in the Site Selection Area, and you have secured the Site, we will provide you an area in which you will have protected rights (the "Territory"). The size of your Territory may vary from the territory granted to other franchisees based on the location and demographics surrounding your Studio. Typically, the territory will be a geographic area encompassing (i) a population of approximately 50,000 people surrounding the applicable Studio or (ii) a two-mile radius from the front door of the Studio, whichever includes fewer people. However, in very high-density urban markets having a population above one million people, we might not provide any territory at all or might reduce the territory to no more than a city block. The sources we use to determine the population within your Territory will be publicly available population information (such as data published by the U.S. Census Bureau or other governmental agencies and commercial sources).
You will not receive an exclusive territory. You may face competition from other franchisees, outlets that we own, or other channels of distribution or competitive brands that we control.
Except as described below and for Non-Traditional Locations (defined below), we and our affiliates will not open, or license a third party to open, a Studio within your Territory. Except as stated in the preceding sentence, we and our affiliates have the right to conduct any business activities, under any name, in any geographic area, at any location, regardless of the proximity to or effect on your Studio. For example, we and our affiliates have the right to:
- (1) establish, or license others to operate, Studios or Sessions operating under the Marks and System at Non-Traditional Locations anywhere, including inside and outside the Territory. A "Non-Traditional Location" is a site that is located within a larger venue or facility that is likely to draw at least 75% of its customers from people who use such larger facility, including big box gyms and fitness facilities, cruise ships, military bases, college campuses, airports, sports or entertainment venues, hotels or resorts, theme parks, industrial or office complexes, train stations and other transportation facilities, travel plazas, casinos, hospitals, multi-unit residential properties, and other similar captive market locations;
- (2) establish, or license others to establish, studios or businesses offering similar or identical products, services, classes, and programs and using the System or elements of the System (i) under the Marks anywhere outside of the Territory, or (ii) under names, symbols, or marks other than the Marks anywhere, including inside and outside of the Territory;
- (3) sell or offer, or license others to sell or offer, any products, services, or Sessions using the Marks or other marks through any alternative distribution channels, including through e-commerce, in retail stores, via recorded media, via online videos, or via broadcast media, anywhere, including inside and outside of the Territory;
- (4) advertise, or authorize others to advertise, using the Marks anywhere, including inside and outside of the Territory;
Source: Item 12 — TERRITORY (FDD pages 49–53)
What This Means (2025 FDD)
According to Body20's 2025 Franchise Disclosure Document, the "Territory" granted to a franchisee provides limited territorial protection. The franchise is for a specific Site that Body20 approves, which must be selected within a non-exclusive Site Selection Area. Once Body20 accepts the Site, the franchisee will be granted a Territory. The size of the Territory may vary based on the location and demographics surrounding the studio. Typically, the territory will encompass either a population of approximately 50,000 people surrounding the studio or a two-mile radius from the studio's front door, whichever includes fewer people. However, in very high-density urban markets with a population above one million, Body20 might not provide any territory at all or might reduce the territory to no more than a city block. Body20 uses publicly available population information, such as data published by the U.S. Census Bureau or other governmental agencies and commercial sources, to determine the population within the Territory.
It is important to note that the Body20 franchise does not grant an exclusive territory. Franchisees may face competition from other franchisees, outlets that Body20 owns, or other channels of distribution or competitive brands that Body20 controls. Except for Non-Traditional Locations, Body20 and its affiliates will not open, or license a third party to open, a Studio within the franchisee's Territory. However, Body20 and its affiliates retain the right to conduct any business activities, under any name, in any geographic area, at any location, regardless of the proximity to or effect on the franchisee's Studio, with the exception of opening a Body20 studio within the territory.
Body20 also retains the right to establish or license others to operate Studios or Sessions operating under the Marks and System at Non-Traditional Locations anywhere, including inside and outside the Territory. A Non-Traditional Location is defined as a site located within a larger venue or facility that is likely to draw at least 75% of its customers from people who use such larger facility, including big box gyms and fitness facilities, cruise ships, military bases, college campuses, airports, sports or entertainment venues, hotels or resorts, theme parks, industrial or office complexes, train stations and other transportation facilities, travel plazas, casinos, hospitals, multi-unit residential properties, and other similar captive market locations. As long as the franchisee is in compliance with the Franchise Agreement, their exclusive rights in the Territory will not be modified for any reason, except by mutual written agreement signed by both parties.
During the Term, a Body20 franchisee must achieve certain minimum sales levels: average monthly Gross Sales of at least $30,000 in the first full calendar year after the Opening Date, and average monthly Gross Sales of at least $40,000 in the second and each subsequent full calendar year after the Opening Date. Failure to meet these Minimum Sales Levels for two consecutive years constitutes an Event of Default, potentially leading to a reduction in the size of the Territory or termination of the Franchise Agreement.