In Virginia, what is the consequence if any grounds for default or termination stated in the Kidokinetics Franchise Agreement does not constitute 'reasonable cause' under the Virginia Retail Franchising Act?

According to Kidokinetics's 2024 Franchise Disclosure Document, if any grounds for default or termination outlined in the Franchise Agreement do not constitute 'reasonable cause' under the Virginia Retail Franchising Act or the laws of Virginia, that specific provision may not be enforceable. This is in direct recognition of the restrictions detailed in Section 13.1-564 of the Virginia Retail Franchising Act.

This means that Kidokinetics cannot enforce a termination clause that is deemed unreasonable under Virginia law. This provision protects franchisees from potentially unfair or arbitrary terminations by ensuring that there is a legitimate and justifiable reason for ending the franchise agreement.

For a prospective Kidokinetics franchisee in Virginia, this offers a degree of security. It ensures that the franchisor must have a valid and legally sound reason for terminating the agreement, preventing the franchisor from using undue influence to end the franchise relationship without reasonable cause. Franchisees should familiarize themselves with the definition of 'reasonable cause' under Virginia law to fully understand their rights and protections.