Will Brain Balance unreasonably withhold agreement to relieve a franchisee of obligations arising from and after a sale, assignment, transfer, conveyance, encumbrance, or gift to an unrelated third party?

According to Brain Balance's 2025 Franchise Disclosure Document, the franchise agreement is personal, and franchisees remain responsible for their obligations under the agreement. However, Brain Balance will not unreasonably withhold written agreement to release a franchisee from obligations arising from a sale, assignment, transfer, conveyance, encumbrance, or gift to an unrelated third party. This excludes obligations that apply following the termination or expiration of the franchise agreement.

This means that if a franchisee sells their Brain Balance franchise to an unrelated third party, they can be relieved of their responsibilities under the franchise agreement, provided Brain Balance gives written consent. Brain Balance's consent will not be unreasonably withheld, which offers some protection to the franchisee. However, this release does not extend to obligations that survive the termination or expiration of the agreement, meaning certain responsibilities might still apply even after the sale.

It is important for prospective Brain Balance franchisees to understand the conditions under which they can be released from their obligations when transferring the franchise. Franchisees should carefully review the franchise agreement and consult with legal counsel to fully understand their rights and responsibilities, especially those that persist after the sale of the franchise. Understanding these terms is crucial for planning an exit strategy and avoiding potential liabilities.