Within what timeframe must the heir or successor of a deceased or permanently disabled Kidokinetics franchisee transfer the Kidokinetics business if they do not wish to accept the obligations of the Franchise Agreement?
Kidokinetics Franchise · 2024 FDDAnswer from 2024 FDD Document
If Franchisee's heir or successor does not wish to accept the obligations of the Franchise Agreement, he or she may transfer the Franchised Business in accordance with the obligations contained in this Article 15 of the Agreement within six months from the date of death or permanent disability, to a third party approved by Franchisor in writing.
A transfer under this Section 15.6 is subject to the conditions for Transfers in this Article 15.
Nothing contained herein is intended, nor will it, extend the term of the Franchise Agreement.
For purposes of this Agreement, the term "permanent disability" means a mental or physical disability, impairment or condition that is reasonably expected to prevent or actually does prevent such person from supervising the operation of Franchisee's Kidokinetics Business for six months from its onset.
Immediately after the death or permanent disability of such person, or while the Franchised Business is owned by an executor, administrator, guardian, personal representative or trustee of that person, the Kidokinetics Business shall be supervised by an interim successor manager satisfactory to Franchisor, pending appointment of an approved Manager or transfer of the Franchised Business to the deceased or disabled individual's lawful heirs or successors. If the executor, administrator, guardian, personal representative or trustee cannot or does not appoint an interim manager, Franchisor may provide interim on-site management of Franchisee's Kidokinetics Business, for which services Franchisee shall pay to Franchisor the Interim Management Fee. If Franchisee's heirs or successors do not appoint a Manager or transfer the Franchised Business within 180 days, the Franchise Agreement will automatically terminate, unless prohibited by law.
Source: Item 22 — CONTRACTS (FDD page 59)
What This Means (2024 FDD)
According to Kidokinetics's 2024 Franchise Disclosure Document, if the heir or successor of a deceased or permanently disabled franchisee does not wish to accept the obligations of the Franchise Agreement, they have six months from the date of death or permanent disability to transfer the franchised business. This transfer must be done in accordance with Article 15 of the Franchise Agreement and requires the franchisor's written approval.
If the heir or successor is unable or unwilling to comply with the obligations, they may appoint a manager approved by Kidokinetics to operate the business. However, if a manager is not appointed or the business is not transferred within 180 days, the Franchise Agreement will automatically terminate, unless prohibited by law.
This clause ensures that Kidokinetics maintains control over who operates its franchises, even in unforeseen circumstances. It also provides a limited time frame for the franchisee's successors to decide whether to take on the business or transfer it to a new, approved franchisee. This protects the Kidokinetics brand and ensures business continuity.