What happens if a Brain Balance franchisee breaches an agreement with a designated supplier?
Brain_Balance Franchise · 2025 FDDAnswer from 2025 FDD Document
reflects an understatement of GR as reported to COMPANY of five percent (5%) or more for any calendar year;
- (j) FRANCHISEE is in breach of any of the terms or conditions of the Software Agreement; or
- (k) FRANCHISEE is in breach of any of the agreements with supplier(s) designated by COMPANY for purchase of equipment, advertising materials, services or other supplies, products, and materials required for the operation of the Franchised Business.
- 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.
- (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.
- 17.04.
Source: Item 22 — CONTRACTS (FDD pages 70–72)
What This Means (2025 FDD)
According to Brain Balance's 2025 Franchise Disclosure Document, if a franchisee breaches any agreements with suppliers designated by Brain Balance for purchasing equipment, advertising materials, services, or other required supplies, products, and materials, it constitutes an event of default under the franchise agreement.
Upon such an event of default, Brain Balance has the option to terminate the franchise agreement with only five days' written notice. This termination occurs without providing the franchisee an opportunity to cure the breach, potentially leading to immediate cessation of operations. Alternatively, if the default continues for 30 or more days after Brain Balance provides notice, Brain Balance can cease providing services and benefits to the franchisee until the franchisee rectifies the default and is current with all payments and reports.
Upon termination of the agreement, the franchisee must cease operating the Brain Balance center, discontinue using Brain Balance's names and marks, and change the center's name to exclude any Brain Balance branding. This clause underscores the importance of adhering to the franchisor's approved suppliers to maintain compliance and avoid potential termination of the franchise agreement.