Under what circumstances can Hyper Kidz bring an action in any State or Federal District Court?
Hyper_Kidz Franchise · 2024 FDDAnswer from 2024 FDD Document
9.1.4 If you make, or have made, any material misrepresentation to us in connection with obtaining this Agreement, any site approval hereunder, or any Franchise Agreement.
9.1.5 If you default in the performance of any obligation under any Franchise Agreement with us, provided such default results in the termination of the Franchise Agreement.
9.1.6 If you suffer a violation of any law, ordinance, rule or regulation of a governmental agency in connection with the operation of the business, and permit the same to go uncorrected after notification thereof, unless there is a bona fide dispute as to the violation or legality of such law, ordinance, rule or regulation, and you promptly resort to courts or forums of appropriate jurisdiction to contest such violation or legality.
9.1.7 If any of you is convicted in a court of competent jurisdiction of an indictable offense punishable by a term of imprisonment in excess of one (1) year.
9.1.8 If any of your principals shall become insolvent or make a general assignment for the benefit of creditors; if a petition in bankruptcy is filed by you or such a petition is filed against and not opposed by you; if you are adjudicated a bankrupt or insolvent; if a bill in equity or other proceeding for the appointment of a receiver or other custodian for you or your business or assets is filed and consented to by you; if a receiver or other custodian (permanent or temporary) of your assets or property, or any part thereof, is appointed by any court of competent jurisdiction; if proceedings for a composition with creditors under any state or federal law should be instituted by or against you; if a final judgment remains unsatisfied or of record for thirty (30) days or longer (unless a supersedeas bond is filed); if execution is levied against your business or property; if suit to foreclose any lien or mortgage against the premises or equipment is instituted against you and not dismissed within thirty (30) days; or if the real or personal property of the business shall be sold after levy thereupon by any sheriff, marshal, or constable.
9.1.9 If you or any of your affiliates cease to operate all of the Hyper Kidz Businesses opened pursuant to the terms of this Agreement.
Source: Item 23 — RECEIPTS (FDD pages 52–205)
What This Means (2024 FDD)
According to Hyper Kidz's 2024 Franchise Disclosure Document, there are several circumstances under which Hyper Kidz may bring an action in any State or Federal District Court. These include situations where the franchisee makes a material misrepresentation to Hyper Kidz in connection with obtaining the agreement, site approval, or any Franchise Agreement. Additionally, if the franchisee defaults in the performance of any obligation under any Franchise Agreement, resulting in the termination of the Franchise Agreement, Hyper Kidz may take legal action.. Hyper Kidz can also bring an action if the franchisee violates any law, ordinance, rule, or regulation of a governmental agency in connection with the operation of the business and fails to correct it after notification, unless there is a legitimate dispute that is promptly contested in court.
Further, Hyper Kidz may bring an action if any of the franchisee's principals are convicted of an indictable offense punishable by a term of imprisonment exceeding one year. Legal action may also be initiated if the franchisee or any of their principals become insolvent, make a general assignment for the benefit of creditors, file for bankruptcy, are adjudicated bankrupt or insolvent, or face proceedings for the appointment of a receiver or custodian for their business or assets. This also applies if a final judgment remains unsatisfied for thirty days or longer (unless a supersedeas bond is filed), if execution is levied against the business or property, if a suit to foreclose any lien or mortgage against the premises or equipment is instituted and not dismissed within thirty days, or if the real or personal property of the business is sold after levy by a sheriff, marshal, or constable.
Finally, Hyper Kidz may bring an action if the franchisee or any of their affiliates cease to operate all of the Hyper Kidz Businesses opened pursuant to the terms of the agreement. These stipulations outline various scenarios where Hyper Kidz reserves the right to pursue legal remedies to protect its interests and ensure compliance with the franchise agreement.