Is a Hyper Kidz franchisee required to execute additional documents as requested by the franchisor?
Hyper_Kidz Franchise · 2024 FDDAnswer from 2024 FDD Document
- 17.1.2 You shall, within six (6) months before the expiration of the initial term, but not later than three (3) months before the expiration of the initial term, provide written notice to us that you wish to sign a Successor Agreement, and we, in turn, shall provide you with any documents that you are required to execute for the successor term, which documents may include, but are not limited to, a general release, our Successor Agreement and all other ancillary agreements, instruments and documents then customarily used by us in the granting of Hyper Kidz Franchises and will require payment of the Successor Agreement Fee. (the "Successor Franchise Documents").
- 17.1.3 You shall execute the Successor Franchise Documents and all other documents and instruments that we require in order to renew. You shall return the executed Successor Franchise
Documents to us, together with payment of a Successor Agreement Fee equal to fifty percent (50%) of our then-current initial franchise fee, by no later than the expiration date of this Agreement. If we do not receive the executed documents and Successor Agreement Fee by such expiration date, then this Agreement shall expire, you shall have no further rights under this Agreement, and you shall comply with the provisions of Article 19 and any other provisions that survive termination or expiration of this Agreement.
Source: Item 22 — CONTRACTS (FDD page 52)
What This Means (2024 FDD)
According to the 2024 Hyper Kidz Franchise Disclosure Document, a franchisee is required to execute additional documents and instruments that Hyper Kidz requires in order to renew their franchise agreement. Specifically, if a franchisee wishes to renew their franchise agreement for an additional term of ten years, they must provide written notice to Hyper Kidz within a specified timeframe before the expiration of the initial term.
Hyper Kidz will then provide the franchisee with the necessary documents to execute for the successor term. These documents may include a general release, the Successor Agreement, and all other ancillary agreements, instruments, and documents that Hyper Kidz customarily uses when granting new franchises. These documents are collectively referred to as the "Successor Franchise Documents."
The franchisee must return the executed Successor Franchise Documents to Hyper Kidz, along with the Successor Agreement Fee, by the expiration date of the initial agreement. Failure to do so will result in the expiration of the agreement, and the franchisee will lose all further rights under the agreement and must comply with the provisions of Article 19, which outlines the rights and obligations upon termination or expiration.