Under what circumstances is the Initial Franchise Fee for a Kidokinetics franchise fully earned and non-refundable?
Kidokinetics Franchise · 2024 FDDAnswer from 2024 FDD Document
s Agreement.
- 5.3. Software License Fee. Franchisee must pay Franchisor a "Software License Fee" of $3,000 for use of Franchisor's proprietary software when Franchisee signs this Agreement. This fee is uniform and non-refundable. Franchisee must also sign the "Software License Agreement," the form of which is attached to Franchisor's Franchise Disclosure Document in Exhibit H, when Franchisee signs the Franchise Agreement. If this Agreement is for an additional Kidokinetics Business, Franchisee shall pay Franchisor a reduced Software License Fee of $1,000 when Franchisee signs this Agreement.
- 5.4. Business Coaching and Training Services. If this Franchise Agreement is for Franchisee's first Kidokinetics Business or if Franchisor approves Franchisee's request to do so in connection with the launch of an additional Kidokinetics Business, Franchisor or its affiliate will provide certain in-person business coaching and training services initial launch of the Kidokinetics Business. Franchisee shall pay a fee of $7,500. This fee is due upon signing the Franchise Agreement and is not refundable under any circumstances. Franchisor will determine when this service within 6 months after the Kidokinetics Business opens, subject to the parties' mutual availability.
- 5.5. Recurring Fees.
Kidokinetics
5.5.1. Royalty. On Wednesday of each week (or such other date as we designate, you agree to pay us a royalty fee equal to eight percent (8%) of Gross Sales during the previous week (Monday through Sunday) ("Percentage Royalty"). At the end of the month, if the Percentage Royalty for that month is less than the minimum royalty in the chart below, you will pay us the difference ("Minimum Royalty") to meet your Minimum Royalty obligation. You will receive a 90-day grace period ("Grace Period"), beginning on the day you successfully complete the initial training class, before you are required to begin paying the Minimum Royalty, but the Percentage Royalty will be in effect immediately.
Source: Item 22 — CONTRACTS (FDD page 59)
What This Means (2024 FDD)
According to Kidokinetics's 2024 Franchise Disclosure Document, certain fees are non-refundable once paid. Specifically, the Software License Fee and the Business Coaching and Training Services fee are non-refundable.
The Software License Fee is $3,000 and is required for the use of Kidokinetics's proprietary software. This fee is due when the Franchise Agreement is signed and is uniformly applied to all new franchisees. If a franchisee is acquiring an additional Kidokinetics business, a reduced Software License Fee of $1,000 is required when signing the agreement.
A fee of $7,500 is required for business coaching and training services. This fee is due upon signing the Franchise Agreement and is not refundable under any circumstances. Kidokinetics will determine when this service will be provided within 6 months after the Kidokinetics Business opens, subject to the parties' mutual availability.
The Technology Fee is also non-refundable under any circumstances. Franchisees must pay this fee monthly for technology-related services. Kidokinetics retains the right to increase the rate and/or payment frequency of the Technology Fee at any time.