Under what conditions can Kidokinetics freely assign the Franchise Agreement?

According to Kidokinetics' 2024 Franchise Disclosure Document, Kidokinetics has the right to assign its rights within the Franchise Agreement. If Kidokinetics assigns its rights in the agreement, it is not required to remain in the youth fitness business or to offer or sell any products or services to the franchisee. This means that Kidokinetics could transfer the agreement to another party who may not have the same focus or commitment to the Kidokinetics brand.

Conversely, the document places restrictions on the franchisee's ability to transfer the agreement. The franchisee's rights and duties are considered personal, based on Kidokinetics' assessment of the franchisee's character, skills, and financial capacity. Therefore, a franchisee cannot transfer the agreement without prior written approval from Kidokinetics, which, however, will not be unreasonably withheld.

If a franchisee attempts to transfer the agreement without approval, Kidokinetics has the right to void the transfer. This protects Kidokinetics' interests by ensuring that any new franchisee meets their standards and is capable of upholding the Kidokinetics brand. The FDD outlines several conditions that must be met for a transfer to be approved, including the transferee's moral character and financial stability. This is a fairly standard clause in franchise agreements, as franchisors want to ensure that franchisees are committed to the brand and have the resources to succeed.