What advance notice must Kidokinetics provide if they intend not to renew a franchise?
Kidokinetics Franchise · 2024 FDDAnswer from 2024 FDD Document
sion of the Franchise Agreement and to cure such failure after being given written notice thereof and a reasonable opportunity, which in no event need be more than 30 days, to cure such failure.
- (d) A provision that permits us to refuse to renew your Franchise without fairly compensating you by repurchase or other means for the fair market value at the time of expiration of your inventory, supplies, equipment, fixtures, and furnishings. Personalized materials which have no value to us and inventory, supplies, equipment, fixtures, and furnishings not reasonably required in the conduct of the Franchise business are not subject to compensation. This subsection applies only if: (i) the term of the Franchise is less than five years; and (ii) you are prohibited by the Franchise Agreement or other agreement from continuing to conduct substantially the same business under another trademark, service mark, trade name, logotype, advertising, or other commercial symbol in the same area subsequent to the expiration of the Franchise or you do not receive at least six months' advance notice of our intent not to renew the Franchise.
- (e) A provision that permits us to refuse to renew a Franchise on terms generally available to
other franchisees of the same class or type under similar circumstances. This section does not require a renewal provision.
- (f) A provision requiring that arbitration or litigation be conducted outside the State of Michigan.
Source: Item 23 — RECEIPT (FDD pages 59–205)
What This Means (2024 FDD)
According to Kidokinetics' 2024 Franchise Disclosure Document, the amount of advance notice required for non-renewal varies based on the state where the franchise operates. Specifically, Michigan requires Kidokinetics to provide at least six months' advance notice of their intent not to renew a franchise under certain conditions. This applies if the franchise term is less than five years and the franchisee is restricted from operating a similar business in the same area after the franchise expires.
In contrast, for franchises governed by Minnesota law, Kidokinetics must provide 180 days' notice for non-renewal of the Franchise Agreement, as mandated by Minnesota Statute Section 80C.14, Subds. 3, 4 and 5. This Minnesota statute also stipulates that franchisees must be given 90 days' notice of termination (with 60 days to cure) except in certain specified cases.
For prospective Kidokinetics franchisees, it is crucial to understand the specific regulations in their state regarding franchise renewal and termination. The FDD highlights that Michigan and Minnesota have specific provisions that protect franchisees in these situations. Franchisees should consult with legal counsel to fully understand their rights and obligations under the Franchise Agreement and applicable state laws, as these can significantly impact the terms of their franchise and the conditions under which it can be terminated or not renewed.