After the Byrider Franchise Agreement is terminated, is the franchisee required to maintain confidentiality of proprietary information furnished by Byrider?
Byrider Franchise · 2025 FDDAnswer from 2025 FDD Document
chisee (or any person/company affiliated with the Franchisee) under any other agreement, including, but not limited to, any other franchise agreement, between the Company (or any of its affiliates) and the Franchisee (or any person/company affiliated with the Franchisee), and any default by the Franchisee (or any person/company affiliated with the Franchisee) under any obligation to the Company (or any of its affiliates) may be regarded as a default under this Agreement.
ARTICLE XVII
OBLIGATIONS UPON TERMINATION
17.1 Obligations. In the event of the termination or expiration of this Agreement, whether by reason of default, lapse of time or other cause, the Franchisee shall: (A) promptly pay all amounts owed to the Company; (B) promptly return to the Company the Manual and other confidential materials including, without limitation, all the BYRIDER Computer Software; (C) maintain confidentiality of all proprietary and Confidential Information furnished by the Company; (D) immediately cease using any of the Marks except as provided for herein; (E) immediately make all alterations to the building facilities and exterior signs at the Business Location to distinguish them from the appearance and identity of a Business; if the Franchisee shall fail or refuse to make or cause such changes to be made, the Company, without prejudice to its other rights and remedies, may enter upon the Business Location, forcibly if necessary, without being guilty of trespass or any other tort, and make such changes at the Franchisee's expense except as provided for herein; (F) within thirty (30) days after the termination or expiration of this Agreement, cancel all Byrider telephone listings, numbers and directory advertising, and, if required by the Company, direct the transfer of the same to the Company or on its order; (G) take such actions as may be necessary or desirable to assign to the Company or the Company's designee any Internet domain names, assumed name, rights or equivalent registration which contain the Marks, including, without limitation, any slogans used by the Company, within thirty (30) days after the termination or expiration of this Agreement; (H) comply with all covenants contained in Article XVIII herein; (I) pay all costs, including attorneys' fees, incurred by the Company in terminating this Agreement.
Further, if the Franchisee or an affiliate of Franchisee is the titleholder of the Business Location and if the termination of this Agreement is due to Franchisee's breach prior to the scheduled expiration of this Agreement according to 5.1 herein, the Company shall have the right, but not the obligation, to enter into a lease for the Business Location at a fair market value rental for a term of two (2) years.
- 17.2 Termination of Access to BYRIDER Computer Software. Upon termination or expiration of this Agreement, the Software Agreement shall also concurrently expire or terminate. Upon such termination or expiration, the Company shall not be obligated to provide the Franchisee with access to the BYRIDER Computer Software or provide any services with respect thereto, except that the Company shall promptly make available to Franchisee (in a commercially reasonable media and form or format, as Company shall determine) any and all information needed to permit Franchisee (or its assignee) to collect its receivables and otherwise engage in an orderly transfer, transition or wind down of Franchisee's Business.
- 17.3 Survival of Obligations. The expiration or termination of this Agreement shall be without prejudice to any of the rights and remedies of the Company with respect to the foregoing obligations, competitive covenants and other like matters that reasonably would survive the end of this Agreement.
ARTICLE XVIII
COVENANTS NOT TO COMPETE
18.1 In-Term Covenant Not To Compete.
Franchisee and its owners agree that, during this Agreement's term, neither Franchisee, nor any owner, nor any member of Franchisee's or an owner's immediate family will:
- (a) have any direct or indirect, controlling or non-controlling interest as an owner (whether of record, beneficial or otherwise) in, or as a landlord of, a Competitive Business (defined below), wherever located or operating;
- (b) perform services as a director, officer, manager, employee, consultant, representative or agent, or in any other capacity, for a Competitive Business, wherever located or operating;
- (c) recruit or hire any employee of Company, Company's affiliates or Company's franchisees without obtaining prior written permission from such employer; or
- (d) divert or attempt to divert any actual or potential business or customer of the Franchisee's Business to a Competitive Business.
Source: Item 23 — Receipts (FDD pages 88–335)
What This Means (2025 FDD)
According to Byrider's 2025 Franchise Disclosure Document, franchisees are obligated to maintain the confidentiality of proprietary and confidential information even after the termination or expiration of the Franchise Agreement. Specifically, upon termination, the franchisee must maintain confidentiality of all proprietary and Confidential Information furnished by Byrider. This obligation extends both during and after the termination of the franchisee's relationship with Byrider. The franchisee must retain all such information in trust for the sole use and benefit of Byrider and/or its affiliates.
This requirement means that a former Byrider franchisee cannot disclose, disseminate, transfer, or use any confidential information of Byrider, nor can they permit anyone else to do so. This includes any information, knowledge, and know-how, including materials, technology systems, techniques, and other data that Byrider designates as confidential. The franchisee must also take all necessary steps to ensure that all such confidential information is kept secret and confidential for the sole use and benefit of Byrider and its affiliates.
The FDD states that these confidentiality obligations are crucial to protect Byrider's valuable, special, and unique confidential information, on which its business depends. The franchisor protects this information by keeping it secret and confidential for the sole use and benefit of Byrider and its affiliates. Franchisees must also ensure that their employees, agents, and representatives comply with these confidentiality provisions. This obligation survives the termination or breach of the Franchise Agreement.