Under what condition can a Kidokinetics franchisee commence legal action against Kidokinetics or its affiliates regarding a claim or dispute?

You must first bring any claim that is between us to the attention of our management. You must first exhaust our internal dispute resolution procedures before you may bring your dispute before a third party. The requirement that you must first attempt to resolve disputes internally will survive the termination or expiration of your term. At our option, any disputes and claims that are not resolved by internal dispute resolution must, at our option, be submitted to mediation. The mediation will take place in Broward County, Florida before the American Arbitration Association ("AAA") in accordance with the AAA's Commercial Mediation Rules then in effect. You must notify us, with details of your claim or dispute, before commencing any legal action against us or our affiliates. Once we receive your notice, we will have 30 days to notify you as to whether we or our affiliates elect to exercise the option to submit the matter to mediation. You may not commence any action against us or our affiliates regarding any claim or dispute in any court unless we fail to exercise our option to submit the claim or dispute to mediation, or such mediation proceedings have been terminated under certain circumstances. This agreement to mediate will survive any termination or

Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 40–46)