Who is bound by the provisions of the Kidokinetics release, besides the immediate parties?

According to Kidokinetics's 2024 Franchise Disclosure Document, the franchise agreement is not intended to confer rights or remedies upon any person or legal entity not a party to the agreement. However, there is an exception: additional insureds and indemnitees are considered third-party beneficiaries specifically with respect to indemnification obligations. This means that while generally only the franchisee and Kidokinetics are bound by the agreement, certain other parties who are insured under the franchisee's insurance policies or who are entitled to indemnification (protection from losses or damages) can enforce the indemnification provisions of the franchise agreement.

This clause is important for prospective Kidokinetics franchisees because it clarifies who can benefit from or enforce specific parts of the franchise agreement. While the agreement primarily governs the relationship between the franchisee and Kidokinetics, it also acknowledges that certain third parties, such as insurance companies or parties being indemnified, have rights related to indemnification. This ensures that these third parties can seek protection or compensation as outlined in the agreement, even though they are not direct signatories.

In practical terms, this means that if a franchisee is required to indemnify certain parties (Indemnitees) under the franchise agreement, those parties can directly enforce that obligation against the franchisee. Similarly, if the franchisee is required to maintain insurance coverage that names certain parties as additional insureds, those insured parties can rely on the terms of the franchise agreement to establish their rights to coverage. This is a fairly standard practice in franchising, as it provides clarity and protection to parties who may be affected by the franchisee's operations but are not directly involved in the franchise relationship.