What actions can Hyper Kidz take upon the occurrence of events stated in Section 9.2?
Hyper_Kidz Franchise · 2024 FDDAnswer from 2024 FDD Document
- 9.2 Upon occurrence of any of the events stated in this Section 9.2, we may, without prejudice to any other rights or remedies contained in this Agreement or provided by law or equity, terminate this
Agreement. Such termination shall be effective thirty (30) days after written notice (or such other notice as may be required by applicable state law) is given by us to you of any of such events, if such defaults are not cured within such period:
- 9.2.1 If you shall use the System or Marks, or any other names, marks, systems, insignia, symbols or rights which are our property except pursuant to, and in accordance with, a valid and effective Franchise Agreement.
- 9.2.2 If you, shall have any interest, direct or indirect, in the ownership or operation of any arts and crafts business engaged in the sale of services similar to those permitted to be sold by you within the Development Area or in any business which looks like, copies or imitates the Hyper Kidz Business or operates in a manner tending to have such effect other than pursuant to a valid and effective Franchise Agreement.
- 9.2.3 If you shall fail to remit to us any payments pursuant to Section 2 when same are due.
- 9.2.4 If you shall begin work upon any Hyper Kidz Business at any site unless all the conditions stated in Section 3 hereof have been met.
- 9.2.5 If you fail to obtain our prior written approval or consent, including but not limited to site approval or site plan approval, as expressly required by this Agreement.
- 9.2.6 If you default in the performance of any other obligation under this Agreement.
- 9.2.7 If you open any Hyper Kidz Business for business before a Franchise Agreement for such Hyper Kidz Business has been fully executed.
- 9.2.8 If you fail to obtain execution of a covenant required by Section 12.8 below.
Source: Item 23 — RECEIPTS (FDD pages 52–205)
What This Means (2024 FDD)
According to Hyper Kidz's 2024 Franchise Disclosure Document, if any of the events listed in Section 9.2 occur, Hyper Kidz has the right to terminate the Franchise Agreement. This termination can be enacted without compromising any other legal rights or remedies Hyper Kidz may possess under the agreement, law, or equity principles.
The termination becomes effective 30 days after Hyper Kidz provides written notice to the franchisee, unless state law requires a different notice period. This 30-day period allows the franchisee an opportunity to correct, or 'cure,' the default. If the franchisee fails to rectify the situation within this timeframe, Hyper Kidz can proceed with terminating the agreement.
Section 9.2 lists several events that can trigger termination. These include unauthorized use of the Hyper Kidz system or trademarks, involvement in similar businesses within the designated development area, failure to make payments as required in Section 2 of the agreement, starting work on a Hyper Kidz Business site before meeting all conditions outlined in Section 3, failure to obtain required approvals (such as site approval), defaulting on any other obligation under the agreement, opening a Hyper Kidz Business before a Franchise Agreement is fully executed, and failing to secure a required covenant as per Section 12.8.