During the transition to a new location, will the term of the Kidokinetics Franchise Agreement be abated?

According to Kidokinetics' 2024 Franchise Disclosure Document, the term of the Franchise Agreement will not be abated during the transition to a new location, and this is at the Franchisor's sole and absolute discretion. This means that even while the franchisee is in the process of moving to a new Kidokinetics Business Location, the Franchise Agreement remains in full effect.

Furthermore, the franchisee remains liable for specific payments during this transition period. They must continue to pay weekly Royalty and Brand Development Fund Contributions. These payments will equal the average amount the franchisee paid during the four calendar quarters immediately preceding the date that operations cease at the original location. If the franchisee operated for less than four quarters at the original location, the average will be calculated based on the shorter period they were in business. The franchisee is also responsible for the annual Technology Fee during the transition.

This policy has significant financial implications for Kidokinetics franchisees who choose to relocate. Franchisees need to budget for continued royalty, brand development, and technology fee payments during the transition, even while they may not be generating revenue from the original location or the new location. Franchisees should carefully consider these costs and ensure they have sufficient capital to cover them during the relocation process. It is also important to note that Schedule 1 of the Franchise Agreement will be amended to reflect the address of the new Kidokinetics Business Location.