What is the dependency between the Software License Agreement and the Franchise Agreement for a Brain Balance franchise?
Brain_Balance Franchise · 2025 FDDAnswer from 2025 FDD Document
(g) COMPANY will license to FRANCHISEE the Software under the Application License Agreement as more fully set forth in Section 15.
(j) FRANCHISEE is in breach of any of the terms or conditions of the Software Agreement;
17.03. (a) Upon the occurrence of an Event of Default, COMPANY, at its option, may terminate this Agreement on five (5) days' written notice (or a notice for a longer period of time as may be required by the law of the jurisdiction in which FRANCHISEE's Center is located) without a right to cure, and this Agreement, together with the Franchise granted hereunder, shall thereupon expire.
Source: Item 22 — CONTRACTS (FDD pages 70–72)
What This Means (2025 FDD)
According to the 2025 Brain Balance Franchise Disclosure Document, the Software License Agreement is directly tied to the Franchise Agreement. Brain Balance will license the software to the franchisee under the Application License Agreement, as stated in Section 15 of the FDD. This indicates that access to and use of the software is a component of the overall franchise agreement.
Specifically, a breach of the Software Agreement by the franchisee can result in the termination of the Franchise Agreement. The FDD states that if the franchisee violates any terms or conditions of the Software Agreement, it constitutes an event of default. Upon such an event, Brain Balance has the option to terminate the Franchise Agreement with only five days' written notice, without granting the franchisee an opportunity to rectify the breach.
This close relationship between the two agreements means that franchisees must adhere to the terms of both to maintain their franchise rights. The software is integral to operating the Brain Balance center, and failure to comply with the Software Agreement has serious repercussions, including the potential loss of the franchise. Prospective franchisees should carefully review the terms of both agreements to fully understand their obligations and the potential consequences of non-compliance.