In Iowa, does the Kidokinetics Franchise Agreement include specific language to comply with the Iowa Business Opportunity Promotions Law?
Kidokinetics Franchise · 2024 FDDAnswer from 2024 FDD Document
nchisor, franchise seller, or other person acting on behalf of the franchisor. This provision supersedes any other term of any document executed in connection with the franchise.
IOWA
Any provision in the Franchise Agreement or Compliance Questionnaire which would require you to prospectively assent to a release, assignment, novation, waiver or estoppel which purports to relieve any person from liability imposed by the Iowa Business Opportunity Promotions Law (Iowa Code Ch. 551A) is void to the extent that such provision violates such law.
The following language will be added to the Franchise Agreement:
NOTICE OF CANCELLATION
_____(enter date of transaction)
You may cancel this transaction, without penalty or obligation, within three business days from the above date. If you cancel, any property traded in, any payments made by you under the contract or sale, and any negotiable instrument executed by you will be returned within ten business days following receipt by the seller of your cancellation notice, and any security interest arising out of the transaction will be cancelled.
If you cancel, you must make available to the seller at your residence or business address, in substantially as good condition as when received, any goods delivered to you under this contract or sale; or you may, if you wish, comply with the instructions of the seller regarding the return shipment of the goods at the seller's expense and risk.
Source: Item 23 — RECEIPT (FDD pages 59–205)
What This Means (2024 FDD)
According to Kidokinetics' 2024 Franchise Disclosure Document, the Franchise Agreement in Iowa does include specific language to comply with the Iowa Business Opportunity Promotions Law. Any provision in the Franchise Agreement or Compliance Questionnaire that requires a prospective release, assignment, novation, waiver, or estoppel that relieves any person from liability imposed by the Iowa Business Opportunity Promotions Law is void to the extent that it violates such law.
Kidokinetics will add specific language to the Franchise Agreement regarding a 'Notice of Cancellation'. This notice informs the franchisee that they may cancel the transaction without penalty or obligation within three business days from the transaction date. If the franchisee cancels, any property traded in, payments made, and negotiable instruments executed will be returned within ten business days following receipt of the cancellation notice. Additionally, any security interest arising from the transaction will be canceled.
The notice also outlines the franchisee's responsibilities upon cancellation, including making available to the seller any goods delivered under the contract in substantially as good condition as when received, or complying with the seller's instructions regarding the return shipment of the goods at the seller's expense and risk. If the franchisee does not return the goods or the seller does not pick them up within 20 days of the cancellation notice, the franchisee may retain or dispose of the goods without further obligation. This ensures franchisees are aware of their cancellation rights and the procedures to follow, providing a level of protection under Iowa law.