What roles might a 'Covenantor' have in a Belocal franchised business?
Belocal Franchise · 2025 FDDAnswer from 2025 FDD Document
RECITALS
- A. Franchisor has the right to use and license the use of a system ("System") for the establishment and operation of franchised businesses that (i) sell print advertising for publications; (ii) sell digital advertising services; (iii) facilitate a publishing of a print publication; (iv) solicit and compile content for a publication; and (v) organize local events, all under the Marks ("Franchised Business").
- B. The System is identified by certain Marks and includes certain Confidential Information which provides economic advantages to Franchisor and licensed users of the System.
- C. Covenantor desires to become involved with Franchisee in the capacity of an owner, officer, director, partner, member, manager, shareholder, guarantor, employee, or contractor of the Franchised Business.
- D. In connection with his or her duties, it will be necessary for Covenantor to have access to some or all of the Confidential Information, to use the Marks, and to obtain valuable knowledge and experience about the Franchised Business, including through training.
- E. Franchisor and Franchisee have agreed on, and Covenantor acknowledges, the importance of restricting the use, access, and dissemination of the Confidential Information and otherwise protecting the goodwill, the Marks, and other legitimate business interests of the Franchisor; and Covenantor has agreed to enter into a written agreement protecting the Confidential Information, further protecting the legitimate interests of the Franchised Business and protecting the System against unfair competition.
- F. Covenantor acknowledges that receipt of and the right to use the Confidential Information, the Marks, the training, and goodwill constitutes independent valuable consideration for the representations, promises, and covenants made by Covenantor herein.
NOW, THEREFORE, in consideration of the mutual covenants and obligations contained herein, the parties agree as follows:
AGREEMENT
Confidentiality/Non-Disclosure
- Covenantor will at all times maintain the confidentiality of the Confidential Information and will use and disclose such Confidential Inform
Source: Item 22 — CONTRACTS (FDD page 71)
What This Means (2025 FDD)
According to Belocal's 2025 Franchise Disclosure Document, a Covenantor can be an owner, officer, director, partner, member, manager, shareholder, guarantor, employee, or contractor of the franchised business. As part of their duties, the Covenantor will have access to confidential information, use Belocal's marks, and gain knowledge and experience about the franchised business through training. The Covenantor acknowledges the importance of protecting confidential information, goodwill, and the franchisor's business interests and agrees to a written agreement to that effect.
The Covenantor is obligated to maintain the confidentiality of the confidential information and only use or disclose it during their work with the franchisee in operating the franchised business. They cannot make copies of confidential information for purposes unrelated to the franchised business. Upon request or termination of their business relationship, the Covenantor must return all materials containing confidential information to the franchisee or Belocal.
To protect confidential information, marks, goodwill, and legitimate business interests, the Covenantor agrees not to solicit Belocal's or the franchisee's current or prospective business advertisers with whom the Covenantor interacted. This restriction applies during their business relationship with the franchisee. For two years after the termination of their relationship, the Covenantor is prohibited from soliciting advertisers with whom they interacted during the twelve months before termination for competitive services, unless with prior written consent from Belocal or as permitted under valid franchise agreements.