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If you recall, the original trio reached an agreement at the end of Season 3:
If Cobra Kai loses the upcoming All-Valley tournament, Kreese must leave the dojo; however, if Cobra Kai wins, Johnny and Daniel must shut down their respective dojos and can no longer be senseis. Unfortunately, the latter came true in the Season 4 finale, but that doesn’t stop Daniel from swearing he will end Cobra Kai once and for all.
Source: https://www.distractify.com/p/cobra-kai-season-4-recap
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