What is the dependency between the appraisal process and the closing process for Body Brain Center?
Body_Brain_Center Franchise · 2025 FDDAnswer from 2025 FDD Document
-fact to direct the Agencies to transfer the telephone numbers, domain names and listings to us if you fail or refuse to do so); and
- (xi) provide us with satisfactory evidence of your compliance with the above obligations within 30 days after the effective date of the termination, expiration or Transfer of this Agreement.
21.2 Right to Purchase Center and Assets
- (a) Generally. Upon the termination or expiration of this Agreement, we shall have the right, but not the obligation, to purchase your Body & Brain Center and/or its assets at fair market value as ascertained by an independent business appraiser. If we elect to exercise this option, the date of determination of the fair market value shall be the effective date of the termination or expiration of the Agreement (the "Appraisal Date"). We will notify you of the specific items that we wish to purchase (the "Acquired Assets").
- (b) Selecting Qualified Appraisers. You and we each shall appoint an appraiser with experience appraising businesses comparable to your Business in the United States (a "Qualified Appraiser"). This appointment of the appraisers shall be made within 30 days after the Appraisal Date by giving written notice to the other party of the name and address of the Qualified Appraiser. If either of us fails to appoint a Qualified Appraiser within the 30-day period, the appraisal shall be made by the sole Qualified Appraiser appointed within that period. If each of us shall have appointed a Qualified Appraiser
within the 30-day period, then within 30 days after that the two (2) Qualified Appraisers shall appoint a third (3rd) Qualified Appraiser.
Source: Item 23 — RECEIPT (FDD pages 43–178)
What This Means (2025 FDD)
According to the 2025 Body Brain Center Franchise Disclosure Document, the appraisal process directly affects the potential purchase of a franchisee's center and assets by Body Brain Center upon termination or expiration of the franchise agreement. Specifically, Body Brain Center has the right, but not the obligation, to purchase the franchisee's Body & Brain Center and/or its assets at fair market value, which is determined by an independent business appraiser.
The "Appraisal Date" is defined as the effective date of the termination or expiration of the Agreement. Within 30 days after this Appraisal Date, both Body Brain Center and the franchisee must each appoint a Qualified Appraiser. If either party fails to appoint an appraiser within this 30-day period, the appraisal will be conducted by the sole appraiser who was appointed. If both parties appoint appraisers, these two appraisers then have 30 days to appoint a third Qualified Appraiser. If they cannot agree on a third appraiser, the American Arbitration Association will appoint one.
This appraisal process is crucial because the fair market value determined by the appraiser(s) directly impacts the price Body Brain Center would pay if it chooses to purchase the franchisee's center and assets. The closing process, therefore, is contingent upon the completion of the appraisal process, as the appraised value establishes the financial terms of the potential purchase. Franchisees should understand these procedures and timelines, as they directly influence their potential financial outcome upon exiting the Body Brain Center system.