What agreement must the Designated Manager of an Aplus franchise sign?
Aplus Franchise · 2024 FDDAnswer from 2024 FDD Document
If the franchisee is a business entity, each owner must sign an Unlimited Guaranty and Assumption of Obligations substantially in the form attached as Attachment 3 to the franchise agreement. Any individual who attends our initial training program, any additional guarantors, all shareholders of a corporation, all members of a limited liability company, all general and limited partners of a partnership and your Designated Manager must sign a non-disclosure and non-competition agreement substantially in the form attached as Attachment 2 to the franchise agreement.
Source: Item 15 — OBLIGATION TO PARTICIPATE IN THE ACTUAL OPERATION OF THE FRANCHISE BUSINESS (FDD pages 51–52)
What This Means (2024 FDD)
According to Aplus's 2024 Franchise Disclosure Document, the Designated Manager must sign a non-disclosure and non-competition agreement. This agreement is substantially in the form attached as Attachment 2 to the franchise agreement. This requirement applies to the Designated Manager regardless of whether the franchisee is an individual or a business entity.
The non-disclosure and non-competition agreement is a standard legal document used in franchising to protect the franchisor's confidential information and prevent unfair competition. By signing this agreement, the Designated Manager agrees not to disclose Aplus's trade secrets, operating procedures, or other proprietary information. They also agree not to compete with Aplus during the term of the franchise agreement and for a specified period afterward, typically within a defined geographic area.
For a prospective Aplus franchisee, this means ensuring that their Designated Manager is willing to sign this agreement. It also highlights the importance of carefully reviewing Attachment 2 to understand the specific terms and conditions of the non-disclosure and non-competition obligations. The franchisee should discuss these obligations with their Designated Manager and legal counsel to ensure everyone understands their responsibilities.