Under the Brain Balance Franchise Agreement, is a Brain Balance franchisee prohibited from owning or participating in any supplemental education services business that competes with the franchised business?
Brain_Balance Franchise · 2025 FDDAnswer from 2025 FDD Document
(d) Neither FRANCHISEE nor any of its officers, directors, shareholders, members, or partners own, maintain, or have any interest in or otherwise participate or engage in, either directly or indirectly, by itself or in conjunction with any other person or entity, any supplemental education services business or other business that competes with the Franchised business, whether as partner, stockholder, member, officer, director, employee, representative, or in any other capacity.
Source: Item 22 — CONTRACTS (FDD pages 70–72)
What This Means (2025 FDD)
According to the 2025 Brain Balance Franchise Disclosure Document, Brain Balance franchisees and their officers, directors, shareholders, members, or partners are restricted from owning, maintaining, or participating in any supplemental education services business or any other business that competes with the franchised Brain Balance business. This prohibition extends to direct or indirect involvement, whether individually or in conjunction with another entity, and covers various roles such as partner, stockholder, member, officer, director, employee, or representative.
This restriction ensures that franchisees remain fully committed to the Brain Balance business and do not divert resources or expertise to competing ventures. It protects Brain Balance's market position and prevents franchisees from leveraging the franchisor's resources and brand recognition to benefit competing businesses.
For a prospective franchisee, this non-compete clause is a significant consideration. It means that they must be prepared to fully dedicate themselves to the Brain Balance franchise and cannot have any existing or future involvement in competing businesses. This commitment should be carefully evaluated in light of their existing business interests and future career aspirations. It is important to note that this restriction applies not only to the franchisee but also to their officers, directors, shareholders, members, or partners, ensuring a comprehensive commitment to the Brain Balance system.