Does Brain Balance's ceasing of services to a franchisee in default relieve the franchisee of their obligations under the agreement?
Brain_Balance Franchise · 2025 FDDAnswer from 2025 FDD Document
- (b) Upon the occurrence of an Event of Default that continues for thirty (30) or more days of COMPANY giving FRANCHISE notice of such default, COMPANY shall have the absolute right without additional notice, to cease providing or making available any or all services and benefits provided for hereunder to FRANCHISEE until FRANCHISEE is current in the payment of fees and the filing of reports and has cured all other defaults.
COMPANY's exercise of such right shall not diminish FRANCHISEE's continuing obligations under this Agreement or constitute an actual or constructive termination of this Agreement.
Source: Item 22 — CONTRACTS (FDD pages 70–72)
What This Means (2025 FDD)
According to the 2025 Brain Balance Franchise Disclosure Document, if a franchisee is in default, Brain Balance has the right to cease providing services and benefits. However, this action does not relieve the franchisee of their ongoing obligations under the Franchise Agreement.
Specifically, even if Brain Balance stops providing services due to a franchisee's default, the franchisee's financial and operational responsibilities remain in effect. This means the franchisee is still responsible for paying fees, submitting reports, and adhering to all other terms outlined in the agreement, even while not receiving support from Brain Balance.
This clause protects Brain Balance by ensuring that franchisees cannot escape their contractual duties simply by triggering a default that leads to a service suspension. It also underscores the importance of franchisees maintaining compliance with the agreement to avoid potential disruptions in service without a release from their obligations.