What actions is the Hyper Kidz franchisee required to take to assist in accomplishing the purposes of the agreement?
Hyper_Kidz Franchise · 2024 FDDAnswer from 2024 FDD Document
ur representatives and franchisee representatives. Franchisee representatives may be chosen by us or may be elected by a vote of other franchisees. If you participate in an advisory council, you will pay any expenses you incur related to your participation, which may include travel, lodging and meals expenses if you must travel to attend council meetings.
ARTICLE 13: ACCOUNTING, REPORTS AND FINANCIAL STATEMENTS
13.1 Record Keeping
You shall establish and maintain, at your own expense, a bookkeeping, accounting, record keeping and records retention system conforming to the requirements prescribed by us from time to time, which includes you obtaining and maintaining a point of sale or computer system ("computer system") that we specify or approve. Each transaction of the Hyper Kidz Business shall be processed on the computer system in the manner we prescribe. We shall have at all times the right to access the computer system and all data processed on the computer system with respect to the Hyper Kidz Business, including, without limitation, your membership and customer database. You shall take such action as may be necessary to provide such access to us, at your expense. You understand and agree that your membership and customer database will, at all times, remain our property and that you shall be an authorized user of such database during the term of this Agreement. In no event shall you retain a copy of such database after the termination or expiration of this Agreement.
13.2 Reports
With respect to the operation and financial condition of the Hyper Kidz Business, you shall furnish to us, in the form we prescribe, from time to time: (a) the Royalty Report, as described in Section 10.2; (b) within fifteen (15) days after the end of each calendar month, an income statement for such month in the form and containing such information as we require; (c) within thirty (30) days of the end of each calendar quarter, a statement of profit and loss for that quarter and a balance sheet as of the end of such quarter;
Source: Item 22 — CONTRACTS (FDD page 52)
What This Means (2024 FDD)
According to Hyper Kidz's 2024 Franchise Disclosure Document, franchisees have several obligations to assist in fulfilling the franchise agreement. Franchisees must establish and maintain a bookkeeping, accounting, record keeping, and records retention system that adheres to Hyper Kidz's requirements, including obtaining and maintaining a point of sale or computer system that Hyper Kidz specifies or approves. All transactions must be processed on this system as prescribed by Hyper Kidz, who retains the right to access the system and all data, including the membership and customer database, which remains Hyper Kidz's property.
Additionally, if it is ever asserted that Hyper Kidz is the employer, joint employer, or co-employer of any of the franchisee's employees, the franchisee must assist Hyper Kidz in defending against this allegation. This assistance includes appearing at any venue requested by Hyper Kidz to testify on their behalf and, if necessary, submitting to depositions or preparing affidavits to deny any employment relationship between Hyper Kidz and the franchisee's employees. If Hyper Kidz is the only named party in such an investigation and requires the franchisee's appearance, Hyper Kidz will cover the reasonable costs associated with the franchisee's appearance.
These requirements ensure that Hyper Kidz franchisees maintain accurate and accessible records, protecting the integrity of the Hyper Kidz system. Furthermore, the obligation to assist in defending against claims of co-employment protects Hyper Kidz from potential liabilities related to the franchisee's employees, reinforcing the franchisor-franchisee relationship as independent entities.