What payment method is required for Royalty and Brand Development Fund payments for a Kidokinetics franchise?
Kidokinetics Franchise · 2024 FDDAnswer from 2024 FDD Document
e in the operation of the Kidokinetics Business.
- 5.8. Method of Payment. Franchisee will, together with the submission of the Gross Sales Report, pay to Franchisor each Wednesday, via an electronic funds transfer program ("EFT Program") the Royalty and the Brand Development Fund, as defined and more particularly described in Article 13, then due. Franchisee must deposit all revenues from the operation of Franchisee's Kidokinetics Business into one bank account within three days of receipt, including cash, checks, and credit card receipts. Before opening Franchisee's Kidokinetics Business, Franchisee must provide Franchisor with Franchisee's bank name, address and account number, a voided check from the bank account, and sign and give to Franchisor and Franchisee's bank, all documents, including Attachment "G" to this Agreement, necessary to effectuate the EFT Program and Franchisor's ability to withdraw funds from such bank account via electronic funds transfer. Franchisee will immediately notify Franchisor of any change in Franchisee's banking relationship, including changes in account numbers. Franchisor reserves the right to require Franchisee to pay any fees due under this Agreement by such other means as Franchisor may specify from time to time. Franchisee's failure to allow electronic funds transfers on an ongoing basis is a breach of this Agreement.
- 5.9. Consumer Price Index. All fees expressed as a fixed dollar amount in this Franchise Agreement are subject to adjustment based on changes to the Consumer Price Index in the United States. Franchisor may periodically review and increase these fees based on changes to the Consumer Price Index, but only if the increase to the Consumer Price Index is more than 5% higher than the corresponding Consumer Price Index in effect on: (a) the effective date of the Franchise Agreement (for the initial fee adjustments); or (b) the date Franchisor implemented the last fee adjustment (for subsequent fee adjustments). Franchisor will notify Franchisee of any CPI adjustment at least 60 days before the fee adjustment becomes effective.
Source: Item 22 — CONTRACTS (FDD page 59)
What This Means (2024 FDD)
According to Kidokinetics's 2024 Franchise Disclosure Document, franchisees are required to use an electronic funds transfer program (EFT Program) to pay both the Royalty and the Brand Development Fund. These payments are due each Wednesday, along with the submission of the Gross Sales Report.
To facilitate this process, a Kidokinetics franchisee must deposit all revenues from their business operations into a single bank account within three days of receipt. Before opening their Kidokinetics Business, the franchisee must provide Kidokinetics with their bank name, address, account number, and a voided check from the bank account. They also need to sign and provide all necessary documents, including Attachment "G" of the Franchise Agreement, to enable the EFT Program and allow Kidokinetics to withdraw funds electronically.
It is the franchisee's responsibility to immediately inform Kidokinetics of any changes to their banking relationship, including changes to account numbers. Kidokinetics retains the right to specify alternative payment methods for any fees due under the agreement. Failure to allow electronic funds transfers on an ongoing basis constitutes a breach of the Franchise Agreement.
If an electronic funds transfer is denied due to insufficient funds, the franchisee will pay Kidokinetics an Insufficient Funds Fee of $50.00 or an amount equal to that charged to Kidokinetics by the bank, whichever is higher, per occurrence.