For Kidokinetics franchises governed by Minnesota law, can consent to the transfer of the franchise be unreasonably withheld?

According to Kidokinetics' 2024 Franchise Disclosure Document, for franchises governed by Minnesota law, Kidokinetics will comply with Minnesota Statute Section 80C.14, Subds. 3, 4 and 5. These statutes dictate that, except in specific cases, franchisees must be given 90 days' notice of termination (with 60 days to cure) and 180 days' notice for non-renewal of the Franchise Agreement. Furthermore, consent to the transfer of a Kidokinetics franchise will not be unreasonably withheld. This provision is designed to protect the franchisee's ability to realize the value of their business when they decide to sell.

This means that Kidokinetics cannot arbitrarily deny a franchisee's request to transfer their franchise to a qualified buyer. If Kidokinetics were to deny a transfer, they would need to provide a reasonable justification for the denial, based on legitimate business concerns. This is a significant protection for franchisees in Minnesota, as it prevents Kidokinetics from unduly restricting their ability to exit the franchise system.

It is important for prospective franchisees in Minnesota to understand these protections, as they provide a degree of security and flexibility in managing their investment. However, franchisees should also be aware that Kidokinetics still has the right to ensure that any potential transferee meets reasonable criteria, such as financial stability and operational experience, to protect the integrity of the Kidokinetics brand and system.