If Kidokinetics decides it is advisable to use substitute trademarks, is Kidokinetics required to reimburse franchisees for any loss of revenue or other indirect expenses due to any modified or discontinued Mark?

According to Kidokinetics's 2024 Franchise Disclosure Document, if Kidokinetics decides to modify or discontinue a trademark and/or use substitute trademarks, franchisees must comply with Kidokinetics's directions within 30 days of receiving notice. However, Kidokinetics will not reimburse franchisees for direct expenses of changing signage, any loss of revenue, or other indirect expenses resulting from the modified or discontinued mark. Kidokinetics also will not cover expenses for promoting a modified or substituted trademark.

This means that if Kidokinetics decides to change its branding or needs to switch to a different trademark for any reason, franchisees are responsible for covering the costs associated with updating their signage and any losses in revenue they might experience during the transition. This could potentially create a financial burden for franchisees, especially if the changes are significant or frequent.

It is important for prospective Kidokinetics franchisees to understand that they bear the financial risk associated with trademark modifications or discontinuations. This is a fairly standard practice in franchising, as franchisors need the flexibility to adapt their branding as market conditions and legal landscapes evolve. However, franchisees should factor in these potential costs when evaluating the overall investment and profitability of a Kidokinetics franchise.