If the Kidokinetics franchisee is an entity, what level of attention must the shareholder or member devote to the management and operation of the Franchised Business?
Kidokinetics Franchise · 2024 FDDAnswer from 2024 FDD Document
greement.
- 10.3. Appointment of Manager. 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.
- 10.3.1.
Source: Item 22 — CONTRACTS (FDD page 59)
What This Means (2024 FDD)
According to Kidokinetics's 2024 Franchise Disclosure Document, if the franchisee is an entity, the shareholder or member must devote their full-time attention and best efforts to managing and operating the franchised business. However, Kidokinetics permits the franchisee to delegate day-to-day operations to a manager, who must be approved by Kidokinetics and meet their standards.
If a manager is appointed, a Principal of the Kidokinetics franchisee must still devote at least 20 hours of work per month to the operation of the franchised business. The appointed manager must devote their full time and best efforts to supervising and managing the Kidokinetics business and cannot engage in any other business activity without Kidokinetics's consent. The manager must also satisfy the training requirements set forth in Article 6 of the agreement.
This requirement ensures that even with a manager in place, a principal of the franchisee entity remains actively involved in the Kidokinetics business, overseeing operations and maintaining a vested interest in its success. This structure allows for some delegation of responsibilities while retaining accountability and oversight at the principal level.