Can a Kidokinetics franchisee appoint a Manager who is not them or a principal of the Franchisee without approval?
Kidokinetics Franchise · 2024 FDDAnswer from 2024 FDD Document
Franchisee, or its shareholder or member if Franchisee is an entity, must devote his/her full-time attention and best efforts to the management and operation of the Franchised Business,
or may delegate the day-to-day operations of the Franchised Business to a manager ("Manager"). Franchisee may not appoint a Manager who is not the Franchisee or Principal of the Franchisee, if an entity, without the approval of Franchisor. All requests regarding appointment of a Manager must be in writing. The Manager shall meet Franchisor's standards and criteria, as set forth in the Franchise Operations Manual or otherwise in writing by Franchisor, and will be an individual otherwise acceptable to Franchisor in its sole discretion. The Manager will devote his or her full time and best efforts to the supervision and management of the Kidokinetics Business, and may not engage in any other business activity without the Franchisor's consent, which may be withheld in Franchisor's sole discretion. The Manager will satisfy the training requirements set forth in Article 6. If the Franchised Business is operated by a Manager, then a Principal of Franchisee must devote at least 20 hours of work per month to the operation of the Franchised Business.
Source: Item 15 — OBLIGATION TO PARTICIPATE IN THE ACTUAL OPERATION OF THE FRANCHISE BUSINESS (FDD page 39)
What This Means (2024 FDD)
According to Kidokinetics's 2024 Franchise Disclosure Document, a franchisee can delegate the day-to-day operations of their franchised business to a manager. However, the franchisee cannot appoint a manager who is not the franchisee or a principal of the franchisee (if the franchisee is an entity) without the franchisor's approval.
The document specifies that all requests for manager appointments must be submitted in writing. The prospective manager must meet Kidokinetics's standards and criteria, as detailed in the Franchise Operations Manual or in writing by the franchisor. The franchisor has the sole discretion to determine if a manager is acceptable.
The manager is required to dedicate their full-time attention and best efforts to supervising and managing the Kidokinetics business and cannot engage in any other business activity without the franchisor's consent. The manager must also satisfy the training requirements outlined in Article 6 of the franchise agreement. If a manager is employed, a principal of the franchisee must still dedicate at least 20 hours per month to the operation of the franchised business.
If the manager is no longer able to serve or no longer qualifies, the franchisee must promptly notify Kidokinetics and request approval for a replacement within 30 days. The replacement manager must meet the same qualifications, including completing all required training and obtaining necessary certifications. Kidokinetics will then approve or disapprove the replacement within 30 days. Until a replacement is designated, the franchisee must provide interim management for the Kidokinetics business, acting in accordance with the terms of the agreement. Failure to comply with these requirements constitutes an event of default under the agreement.