If a Brain Balance franchisee converts to a standard Brain Balance® Center, what fee is required?
Brain_Balance Franchise · 2025 FDDAnswer from 2025 FDD Document
FRANCHISEE acknowledges that the Franchise granted hereunder is limited to the establishment and operation of the Franchised Business in a single location within the Territory and requires FRANCHISEE to maintain and continue to operate its Standard BB Center. FRANCHISEE may not operate the Franchised Business from an additional location or outside of the Territory unless a separate franchise agreement is signed by the parties and an additional Initial Franchise Fee (as hereinafter defined) is paid by FRANCHISEE to COMPANY. If FRANCHISEE stops operating or loses its right to operate the Standard BB Center,
FRANCHISEE must either obtain FRANCHISOR's approval to convert the Franchised Business to a standard Brain Balance® Center, which will not be unreasonably withheld but will require FRANCHISEE to sign a franchise agreement for a standard Center and pay the difference between the initial franchise fee paid by FRANCHISEE under this Agreement and the then-current initial franchise fee for a Standard BB Center, or must stop operating the Franchised Business.
Source: Item 22 — CONTRACTS (FDD pages 70–72)
What This Means (2025 FDD)
According to Brain Balance's 2025 Franchise Disclosure Document, a franchisee who stops operating their Standard Brain Balance Center and wishes to convert their Franchised Business to a standard Brain Balance® Center must obtain approval from Brain Balance. This approval will not be unreasonably withheld.
To complete the conversion, the franchisee is required to sign a franchise agreement for a standard center. Additionally, they must pay the difference between the initial franchise fee they originally paid under their current agreement and the then-current initial franchise fee for a Standard Brain Balance® Center.
This means that the cost to convert is not a fixed amount but depends on two factors: the initial franchise fee the franchisee paid for their existing franchise and the initial franchise fee for a new standard Brain Balance Center at the time of conversion. This could potentially be a significant expense, depending on how much the initial franchise fee has increased since the franchisee signed their original agreement. If the franchisee does not convert the Franchised Business to a standard Brain Balance® Center, they must stop operating the Franchised Business.