Where will arbitration take place for disputes related to the Hyper Kidz Multi-Unit Development Agreement?
Hyper_Kidz Franchise · 2024 FDDAnswer from 2024 FDD Document
| Provision | Section in Multi- | Summary | |
|---|---|---|---|
| (u) Dispute resolution by | Section 19 | Arbitration in Howard County, Maryland (subject | |
| arbitration or mediation | to state law) | ||
| (v) Choice of forum | Section 19 | Howard County, Maryland (subject to state law) |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 41–49)
What This Means (2024 FDD)
According to the 2024 Hyper Kidz Franchise Disclosure Document, any disputes arising from the Multi-Unit Development Agreement that proceed to arbitration will take place in Howard County, Maryland. This is subject to state law.
For a prospective Hyper Kidz multi-unit developer, this means that if a disagreement with the franchisor escalates to arbitration, they will be required to travel to Howard County, Maryland, regardless of where their franchise locations are situated. This could involve significant travel expenses and logistical challenges, especially for franchisees located far from Maryland.
It is common practice in franchising for the location of arbitration to be specified in the franchise agreement. Franchisees should consider the implications of this location, including travel costs and the potential need to hire local legal representation. Understanding this aspect of the agreement is crucial for assessing the overall risk and cost associated with the Hyper Kidz franchise.