factual

After termination of my Kidokinetics franchise, am I allowed to solicit business from customers of any Kidokinetics business?

Kidokinetics Franchise · 2024 FDD

Answer from 2024 FDD Document

  • 18.5.2.

Upon the expiration or earlier termination of this Agreement, or upon a Transfer and continuing for 24 months, Franchisee and Principals, and the spouse of Franchisee and each Principal if any, shall not, either directly or indirectly, for themselves or through, on behalf of or in conjunction with any person or entity (i) divert, or attempt to divert, any business or customer of the Kidokinetics Business or of other franchisees in the System to any competitor, by direct or indirect inducement or otherwise; (ii) participate as an owner, partner, director, officer, employee, consultant or agent or serve in any other capacity in Competing Business within a twenty (20) mile radius of the perimeter of (a) the Territory being granted hereunder, or (b) any other Territory licensed by Franchisor as of the date of expiration or termination of this Agreement; (iii) do or perform, directly or indirectly, any other act injurious or prejudicial to the goodwill associated with the Marks and the System; (iv) in any manner interfere with, disturb, disrupt, decrease or otherwise jeopardize the business of the Franchisor or any Kidokinetics franchisees; or (v) solicit business from customers of Franchisee's former Kidokinetics Business or contact any of Franchisor's suppliers or vendors for any competitive business purpose.

  • 18.6.

Reasonableness of Restrictions.

Franchisee acknowledges and agrees that the covenants not to compete set forth in this Agreement are fair and reasonable and will not impose any undue hardship on Franchisee or Principals, if any, since Franchisee or Principals, as the case may be, have other considerable skills, experience and education which afford Franchisee or Principals, as the case may be, the opportunity to derive income from other endeavors.

Source: Item 22 — CONTRACTS (FDD page 59)

What This Means (2024 FDD)

According to Kidokinetics's 2024 Franchise Disclosure Document, after the termination or expiration of the franchise agreement, a franchisee is restricted from soliciting business from customers of their former Kidokinetics business. This restriction applies for 24 months following the termination or expiration of the agreement.

Specifically, the franchisee (and their principals) cannot directly or indirectly divert or attempt to divert any business or customer of the Kidokinetics business or other franchisees in the Kidokinetics system to any competitor. This includes any form of inducement. Additionally, franchisees are prohibited from interfering with the business of Kidokinetics or any of its franchisees.

These restrictions are in place to protect the goodwill associated with the Kidokinetics brand and system. The FDD states that Kidokinetics considers these restrictions fair and reasonable, given that franchisees and their principals typically possess other skills and experience that allow them to earn income from other ventures.

Disclaimer: This information is extracted from the 2024 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.