What happens to any surplus of monies in the Kidokinetics Brand Development Fund?
Kidokinetics Franchise · 2024 FDDAnswer from 2024 FDD Document
Any surplus of monies in the Brand Development Fund may be invested by us in our sole discretion and unused funds collected in any calendar year will be applied to the following year's funds.
We reserve the right to contribute or loan additional funds to the Brand Development Fund on any terms we deem reasonable.
The Brand Development Fund is not a trust, and we have no fiduciary obligations to you regarding our administration of the Brand Development Fund.
Source: Item 22 — CONTRACTS (FDD page 59)
What This Means (2024 FDD)
According to Kidokinetics's 2024 Franchise Disclosure Document, any surplus funds remaining in the Brand Development Fund can be invested at Kidokinetics's discretion. Furthermore, any unused funds collected during a calendar year will be applied to the following year's funds. This means that Kidokinetics has the authority to manage and reinvest any excess funds in the Brand Development Fund, and these funds will be carried over to support the brand's development in subsequent years.
This policy provides Kidokinetics with flexibility in managing the Brand Development Fund and ensures that contributions from franchisees are utilized effectively over time. By reinvesting surplus funds and carrying over unused amounts, Kidokinetics aims to optimize the impact of the fund on promoting and improving the Kidokinetics system and brand.
However, it's important to note that the Brand Development Fund is not a trust, and Kidokinetics has no fiduciary obligations to franchisees regarding its administration. This means that while Kidokinetics is expected to use the fund to benefit the system, franchisees have limited control over how the funds are spent and no guarantee of a direct or proportionate benefit from their contributions.