Can Kidokinetics operate acquired businesses under the Kidokinetics marks?
Kidokinetics Franchise · 2024 FDDAnswer from 2024 FDD Document
Franchisor.
- 2.2. Reservation of Rights. Franchisee acknowledges and agrees that Franchisor and any parties Franchisor designates will have the right to: (i) establish and operate, and license third parties the right to establish and operate, other franchised businesses using the Marks and System at any location outside of the Territory; (ii) acquire, merge with, engage in joint ventures with, or otherwise affiliate with, and thereafter own and operate and franchise others the right to own and operate, any business of any kind, including businesses that offer products that are similar to those provided by a Franchised Business, within or outside the Territory; (iii) open and operate, or license third parties the right to open or operate, businesses that offer products and services similar to the Franchised Business under marks other than the Marks at any location;
Source: Item 22 — CONTRACTS (FDD page 59)
What This Means (2024 FDD)
According to the 2024 Kidokinetics Franchise Disclosure Document, Kidokinetics has the right to acquire businesses and operate them using the Kidokinetics marks and system. However, if Kidokinetics acquires facilities operating within a franchisee's exclusive territory, Kidokinetics represents that it will not convert these acquired facilities into a Kidokinetics franchise.
This reservation of rights allows Kidokinetics to expand its brand presence through acquisitions. Kidokinetics also retains the right to license third parties to operate businesses using the Kidokinetics marks and system outside of a franchisee's territory. This enables Kidokinetics to grow its franchise network and generate revenue through franchising fees and royalties.
For a prospective franchisee, this means that while they are granted a territory where Kidokinetics will not operate or allow another franchisee to operate a Kidokinetics Business using the same marks, Kidokinetics retains significant rights to operate similar businesses under different marks or through other channels of distribution. It also means that Kidokinetics can acquire businesses, but it will not convert any acquired facilities operating within the Territory to a Kidokinetics franchise.