Does Body20 have the right to exclude specific assets from the purchase of my Body20 studio?
Body20 Franchise · 2025 FDDAnswer from 2025 FDD Document
ing the period between the expiration or termination of this Agreement through (i) the date on which we decide to decline our right to exercise this option (or the expiration of the option, if we fail to provide an Exercise Notice by the deadline) or (ii) the closing of our purchase. However, we may, at any time during that period, assume the management of the Studio ourselves or appoint a third party (who may be our Affiliate) to manage the Studio pursuant to the terms of Section 15.6 (Our Right to Operate).
- (c) Purchase Price. The purchase price for the Purchased Assets will be their fair market value for use in the operation of a non-franchised Competitive Business (and not a Studio). However, the purchase price will not include any value for any rights granted by this Agreement, goodwill attributable to the Marks, our brand image, any Proprietary Information or our other intellectual property rights, or participation in the network of Studios. For purposes of determining the fair market value of all equipment (including the exercise equipment and Technology System) used in operating the Studio, the equipment's useful life shall be determined to be no more than three years. If we and you cannot agree on fair market value for the Purchased Assets, we will select an independent appraiser after consultation with you, and his or her determination of fair market value will be the final and binding purchase price.
- (d) Closing. We will pay the purchase price at the closing, which will take place within 60 days after the purchase price is determined, although we may decide after the purchase price is determined not to complete the purchase. We may set off against the purchase price, and reduce the purchase price by, any and all amounts you owe us or our Affiliates.
Source: Item 23 — RECEIPT (FDD pages 74–251)
What This Means (2025 FDD)
According to Body20's 2025 Franchise Disclosure Document, Body20 does not purchase any rights granted by the agreement, goodwill attributable to the marks, brand image, proprietary information, or other intellectual property rights, or participation in the network of studios. The purchase price for the purchased assets will be their fair market value for use in the operation of a non-franchised competitive business (and not a studio). For equipment, including exercise equipment and the technology system, the equipment's useful life shall be determined to be no more than three years for purposes of fair market value.
If Body20 and the franchisee cannot agree on fair market value for the purchased assets, Body20 will select an independent appraiser after consulting with the franchisee, and their determination of fair market value will be the final and binding purchase price. The purchase will close within 60 days after the purchase price is determined, although Body20 may decide not to complete the purchase after the price is determined.
Body20 may set off against the purchase price any amounts the franchisee owes to Body20 or its affiliates. The franchisee must deliver good and merchantable title to the purchased assets, free and clear of all liens and encumbrances (other than those acceptable to Body20), and transfer all assignable licenses and permits. If the franchisee cannot deliver clear title, the sale will be closed through an escrow. The franchisee and their owners must also sign general releases of claims against Body20 and its affiliates.