How must a Kidokinetics franchisee pay the Royalty and Brand Development Fund?
Kidokinetics Franchise · 2024 FDDAnswer from 2024 FDD Document
- 5.8. Method of Payment. Franchisee will, together with the submission of the Gross Sales Report, pay to Franchisor each Wednesday, via an electronic funds transfer program ("EFT Program") the Royalty and the Brand Development Fund, as defined and more particularly described in Article 13, then due. Franchisee must deposit all revenues from the operation of Franchisee's Kidokinetics Business into one bank account within three days of receipt, including cash, checks, and credit card receipts. Before opening Franchisee's Kidokinetics Business, Franchisee must provide Franchisor with Franchisee's bank name, address and account number, a voided check from the bank account, and sign and give to Franchisor and Franchisee's bank, all documents, including Attachment "G" to this Agreement, necessary to effectuate the EFT Program and Franchisor's ability to withdraw funds from such bank account via electronic funds transfer. Franchisee will immediately notify Franchisor of any change in Franchisee's banking relationship, including changes in account numbers. Franchisor reserves the right to require Franchisee to pay any fees due under this Agreement by such other means as Franchisor may specify from time to time. Franchisee's failure to allow electronic funds transfers on an ongoing basis is a breach of this Agreement.
Source: Item 22 — CONTRACTS (FDD page 59)
What This Means (2024 FDD)
According to Kidokinetics's 2024 Franchise Disclosure Document, franchisees are required to pay both the Royalty and the Brand Development Fund via an electronic funds transfer program (EFT Program) each Wednesday. This payment is submitted together with the Gross Sales Report.
To facilitate this process, a Kidokinetics franchisee must deposit all revenues from their business operations into a single bank account within three days of receipt. Before opening their Kidokinetics Business, the franchisee must provide Kidokinetics with their bank name, address, account number, and a voided check from the bank account. Additionally, the franchisee must sign and provide all necessary documents, including Attachment "G" of the Franchise Agreement, to enable the EFT Program and authorize Kidokinetics to withdraw funds electronically from the designated bank account.
The franchisee is obligated to promptly inform Kidokinetics of any changes to their banking relationship, including any modifications to account numbers. Kidokinetics retains the right to specify alternative payment methods for any fees due under the agreement. Failure to consistently allow electronic funds transfers constitutes a breach of the Franchise Agreement.
Kidokinetics also specifies penalties for late payments or insufficient funds. A late fee of $25 per week will be charged for overdue amounts or late Gross Sales Reports. Interest accrues at a rate of 1.5% per month (or the highest legally permitted rate, if lower) on all unpaid amounts. Furthermore, a $50 insufficient funds fee (or the amount charged to Kidokinetics by the bank, if higher) is applied for any returned checks or denied electronic funds transfers due to insufficient funds.