Can Brain Balance unreasonably withhold consent for a franchisee to assign or transfer their Brain Balance franchise?
Brain_Balance Franchise · 2025 FDDAnswer from 2025 FDD Document
described in Schedule I attached hereto (the "Territory"), at a specific location to be approved in writing by COMPANY, which approval shall not be unreasonably withheld (the "Franchise"). The operation of the Business pursuant to the Franchise is hereinafter referred to as the "Franchised Business."
Source: Item 22 — CONTRACTS (FDD pages 70–72)
What This Means (2025 FDD)
Based on the 2025 Brain Balance Franchise Disclosure Document, the franchisor's approval for the franchisee's center location shall not be unreasonably withheld. This applies to the initial location approval.
Specifically, Brain Balance grants franchisees the right to establish a single location within a defined territory, and franchisees may not relocate or open additional centers without Brain Balance's prior written consent. However, if a franchisee operates a Brain Balance Satellite Center and later seeks to convert it to a standard Brain Balance Center, Brain Balance's approval for this conversion will not be unreasonably withheld. This conversion would require the franchisee to sign a new franchise agreement and pay the difference between the initial fee already paid and the current initial fee for a standard Brain Balance Center.
While the FDD states that Brain Balance will not unreasonably withhold approval for the initial location and conversions from a satellite center to a standard center, the document does not specify whether Brain Balance can unreasonably withhold consent for a franchisee to assign or transfer their franchise. A prospective franchisee should seek clarification from Brain Balance regarding the specific conditions and limitations related to the transfer or assignment of the franchise agreement.