Does the Body Brain Center licensing agreement with BR Consulting, Inc. automatically renew?
Body_Brain_Center Franchise · 2025 FDDAnswer from 2025 FDD Document
The Company (Licensee) has a licensing agreement with BR Consulting, Inc. (Licensor). This agreement automatically renews on an annual basis until terminated.
BR consulting, Inc. is the owner of all the intellectual property rights including, but not limited to, logos, trademarks, service marks, copyrights, and trade secrets which are related with Brain Education programs and/or operating Body & Brain Center.
Licensor grants to Licensee, for the term of agreement, a non-exclusive license to use the licensed materials for distribution of Brain Education Programs and/or operation of Body & Brain Center within the authorized region and the right to sublicense the licensed materials to franchisees for the sole purpose of operating Body & Brain Centers pursuant to the terms of franchise agreements within the authorized region.
Under the terms of this agreement, the Company pays 20% on the total of the initial franchise fee, franchise renewal fee, training fee and transfer fee and 50% of royalties earned from franchisees by the Company. Furthermore, concerning the income derived from memberships and private lessons offered by the Direct Center, a contractual royalty rate has been in effect since 2022. In 2024, a royalty rate of 3%, computed based on the operating margin rate preceding the inclusion of Direct Center's royalty payments, was applied, resulting in a payment of $2,060.
License expenses under this agreement totaled $111,939 and $105,963 for the years ended December 31, 2024 and 2023, respectively.
As of December 31, 2024, the Company owed $2,006 to BR Consulting Inc., which is included in accounts payable in the accompanying 2024 balance sheet.
Source: Item 23 — RECEIPT (FDD pages 43–178)
What This Means (2025 FDD)
According to the 2025 Body Brain Center Franchise Disclosure Document, the licensing agreement between the company (as Licensee) and BR Consulting, Inc. (as Licensor) automatically renews on an annual basis. This automatic renewal continues until the agreement is terminated.
BR Consulting, Inc. owns all intellectual property rights related to Brain Education programs and the operation of Body & Brain Centers. These rights include logos, trademarks, service marks, copyrights, and trade secrets. The licensing agreement grants Body Brain Center a non-exclusive license to use these materials for distributing Brain Education Programs and operating Body & Brain Centers within an authorized region. Body Brain Center also has the right to sublicense these materials to its franchisees for operating their Body & Brain Centers, according to the terms of their franchise agreements.
Under the licensing agreement, Body Brain Center pays BR Consulting, Inc. 20% of the total initial franchise fee, franchise renewal fee, training fee, and transfer fee. Additionally, Body Brain Center pays 50% of the royalties earned from franchisees. For income from memberships and private lessons offered by the Direct Center, a royalty rate has been in effect since 2022. In 2024, this royalty rate was 3%, calculated based on the operating margin rate before including the Direct Center's royalty payments, resulting in a payment of $2,060. License expenses totaled $111,939 in 2024 and $105,963 in 2023. As of December 31, 2024, Body Brain Center owed $2,006 to BR Consulting Inc.