Is an All States M.E.D. franchisee required to provide copies of nondisclosure and non-competition agreements to the franchisor upon request?
All_States_M_E_D Franchise · 2024 FDDAnswer from 2024 FDD Document
Franchisor has the right to require any holder of a legal or beneficial interest in Franchisee, and any officer, director, executive, manager or member of the professional staff and all employees of Franchisee to execute a nondisclosure and non-competition agreement, in a form the same as or similar to the Nondisclosure and Non-Competition Agreement attached as Schedule 2, upon execution of this Agreement or prior to each such person's affiliation with Franchisee. Upon Franchisor's request, Franchisee shall provide Franchisor with copies of all nondisclosure and non-competition agreements signed according to this Section. Such agreements shall remain on file at the business of Franchisee and are subject to audit or review as otherwise stated here. Franchisor shall be a third-party beneficiary with the right to enforce covenants contained in such agreements.
Source: Item 23 — RECEIPTS (FDD pages 44–174)
What This Means (2024 FDD)
According to All States M.E.D.'s 2024 Franchise Disclosure Document, the franchisee is required to provide copies of nondisclosure and non-competition agreements to All States M.E.D. upon request. Specifically, All States M.E.D. has the right to require any individual with a legal or beneficial interest in the franchise, as well as officers, directors, executives, managers, professional staff, and all employees, to execute a nondisclosure and non-competition agreement. This agreement must be in a form similar to the one attached as Schedule 2 in the Franchise Agreement.
Upon All States M.E.D.'s request, the franchisee must provide copies of all signed nondisclosure and non-competition agreements. These agreements must be kept on file at the franchisee's business location and are subject to audit or review. All States M.E.D. is designated as a third-party beneficiary, granting them the right to enforce the covenants within these agreements.
This requirement ensures that All States M.E.D. can protect its confidential information, trade secrets, and business interests by having agreements in place with individuals associated with the franchise. It also allows All States M.E.D. to monitor compliance with these agreements and take necessary action if any breaches occur. The franchisee's compliance with this requirement is essential for maintaining the integrity of the All States M.E.D. system and safeguarding its competitive advantage.