Supplemental Terms for the ClassPass Revenue Guarantee
Last Updated: January 11, 2023
These supplemental terms (the “ClassPass Revenue Guarantee Terms”), together with the overhead agreement which refers to these supplemental terms as being applicable between the Parties (the “Mindbody Terms of Service”), govern the Revenue Guarantee (defined below). Capitalized terms used in these ClassPass Revenue Guarantee Terms but not otherwise defined herein have the meaning given to them in the Mindbody Terms of Service.
Mindbody may, in its sole discretion, modify these ClassPass Revenue Guarantee terms from time to time. Any changes we make will become effective when we post a modified version of the ClassPass Revenue Guarantee Terms to our Website, and we agree the changes will not be retroactive.
1. Our Guarantee
- 1.1. Revenue Guarantee. We guarantee that if the revenue you earn from ClassPass (“ClassPass Revenue”) is less than the revenue you lose, if any, (“Lost Revenue”) during the Guarantee Period, then Mindbody or one of its subsidiaries (including ClassPass) will pay you double the difference (a “Guarantee Payment”) within 60 days (the “Revenue Guarantee”).
- 1.2. Guarantee Period. The Revenue Guarantee shall be measured over a period of 90 days (the “Guarantee Period”). The Guarantee Period shall begin on the date the following conditions are satisfied: (i) we have acknowledged your participation in the Revenue Guarantee; and (ii) you have provided at least 5 (five) Qualifying Reservations (the “Start Date”). The Start Date shall be as displayed in your Mindbody customer acquisition dashboard.
- 1.3. Calculation of ClassPass Revenue. ClassPass Revenue is calculated as the total of: (i) all Payouts; (ii) all revenue you receive from reservations made directly with you by individuals whose first reservation at one of your Venues was made using ClassPass and not via other sources (such as third-party integrators) (“ClassPass Switchers”); and (iii) all applicable taxes, prior to any applicable withholding, set offs, or deductions that may apply in accordance with your ClassPass Partner Agreement.
- Revenue for reservations made by ClassPass Switchers using package deals (such as a 10-pack of classes) or monthly subscriptions shall be determined by Mindbody on a reasonable pro rata basis. For example: if a ClassPass Switcher buys one of your 10-packs for $200, the revenue for each reservation would be $20.
- 1.4. Calculation of Lost Revenue. Lost Revenue is calculated by applying the difference between: (i) your Retail Rate; and (ii) the Payout to all Qualifying Reservations made by customers whose first reservation at one of your Venues in the 12 months preceding the Guarantee Period was made directly with you (such as through your website or front desk, rather than through sources such as third-party integrators) via the Mindbody API.
- 1.5. Tracking. Email address shall be used to establish a user’s unique identity and the source of a user’s first booking.
2. Eligibility & Payments
- 2.1. Eligibility Requirements. To be eligible for the Revenue Guarantee, you must, throughout the Guarantee Period (unless otherwise agreed in writing by us): (i) be an active Mindbody subscriber of the Software Service (Booker subscribers are excluded); (ii) be a ClassPass partner with a signed and ongoing agreement with ClassPass (a “ClassPass Partner”) and make available a consistent level of inventory to ClassPass throughout the Guarantee Period; (iii) set a Payout as agreed by ClassPass and set out in your ClassPass Partner Agreement; and (iv) deploy and maintain SmartTools across all your Venues. You agree and acknowledge that you can only participate in the Revenue Guarantee once and you will only be eligible for one Guarantee Payment, unless otherwise agreed in writing by us.
- 2.2. De Minimis Payments. If a Guarantee Payment is less than $50 USD (or local equivalent) we may elect an alternative method to satisfy our payment obligations to you, such as issuing a credit against the cost of your Software Service.
- 2.3. Right to Set-off. In addition to any other rights or remedies set forth in these ClassPass Revenue Guarantee Terms, we may set-off, withhold or deduct any amounts due or payable from you to Mindbody or its affiliates (including ClassPass) against any Guarantee Payment.
- 2.4. Self-Service Exclusion. We may, in our sole discretion, exclude ClassPass Partners who have signed up to ClassPass using the online tool available at https://studios.classpass.com/path-to-partnership.
If any of the following occurs, the Revenue Guarantee shall be null and void and no Guarantee Payment shall be payable: (i) you breach the ClassPass Partner Agreement or the Mindbody Terms of Service (together, the “Service Agreements”); (ii) all or part of the Service Agreements are terminated, or otherwise rendered inapplicable; and (iii) where you have already participated in the Revenue Guarantee but causes beyond Mindbody’s reasonable control corrupt or affect the administration of the Revenue Guarantee, including (without limitation) technical issues which affect our ability to track fill rates. In no event will you be entitled to a Guarantee Payment where we determine that you have acted fraudulently or in bad faith.
4. Incorporation & Entire Agreement
You acknowledge that these ClassPass Revenue Guarantee Terms are hereby incorporated into and made part of the Mindbody Terms of Service. These ClassPass Revenue Guarantee Terms, together with the Mindbody Terms of Service, constitute the entire agreement and supersede any prior agreements between you and Mindbody and/or ClassPass with respect to the subject matter hereof. These ClassPass Revenue Guarantee Terms take precedence over any conflicting terms in the Service Agreements in connection with the subject matter of these ClassPass Revenue Guarantee Terms. Except as expressly provided herein, any dispute or claim arising from or relating to these ClassPass Revenue Guarantee Terms is subject to the warranties and disclaimer, limitations and exclusions of liability, governing law and all other terms in the Mindbody Terms of Service.
“ClassPass” means ClassPass, LLC and its subsidiaries.
“ClassPass Website” means the ClassPass™ website at www.classpass.com (together with any iPhone®, Android® or other mobile application of such website).
“Payout” means the amount that ClassPass pays per Qualifying Reservation (including to you and, if applicable, your franchisor) as set out in your ClassPass Partner Agreement.
“Qualifying Reservation” means a reservation for a class or service at one of your Venues which is booked via the ClassPass Website, unless such reservation is: (a) cancelled by ClassPass or the ClassPass user in accordance with your cancellation policy, up to 12 hours in advance, (provided that if a reservation is cancelled late, but is subsequently rebooked via ClassPass, then such late cancellation shall not count as a Qualifying Reservation); (b) cancelled by you; or (c) otherwise not honored by you.
“Retail Rate” means your direct price per reservation as at the start date of the Guarantee Period, which we determine to be one of the following: (i) where made available as part of a package deal (such as a 10-pack of classes), the average price-per-reservation; or (ii) the price which a customer would pay for a drop-in reservation; or, if unavailable, (iii) a close equivalent determined by Mindbody.
“SmartTools” means ClassPass’ proprietary platform-related tools, including SmartRate (which determines the Payout) and SmartSpot (which determines inventory management).
“Venue” means any venue, studio or location from which you offer classes and other services to customers.