Does the Franchise Agreement specify the form of confidentiality and non-competition agreements required for Hyper Kidz employees?
Hyper_Kidz Franchise · 2024 FDDAnswer from 2024 FDD Document
You and your Principals must acknowledge and agree that the Confidential Information is confidential to and a valuable asset of us and our affiliates, is proprietary, includes trade secrets of us and our affiliates and is disclosed to you on the condition that you, your Principals and your employees who have access to the Confidential Information agree that during and after the term of the agreement you: (1) will not use the Confidential Information in any other business or capacity; (2) will maintain the absolute confidentiality of the Confidential Information; (3) will not make unauthorized copies of any portion of the Confidential Information disclosed in written or other tangible form; (4) will adopt and implement all reasonable procedures we prescribe to prevent unauthorized use or disclosure of the Confidential Information; and (5) will require all Principals and all employees who have access to the Confidential Information to sign confidentiality and non-competition agreements in the form we prescribe and provide us, at our request, with signed copies of each agreement. We will be a third-party beneficiary of these agreements with the independent right to enforce their terms.
Source: Item 14 — PATENTS, COPYRIGHTS AND PROPRIETARY INFORMATION (FDD pages 38–40)
What This Means (2024 FDD)
According to the 2024 Hyper Kidz Franchise Disclosure Document, the Franchise Agreement requires franchisees to have their employees sign confidentiality and non-competition agreements. Hyper Kidz specifies that these agreements must be in a form prescribed and provided by them.
This means that as a Hyper Kidz franchisee, you are obligated to ensure that all employees who have access to confidential information sign these agreements. Furthermore, you must provide Hyper Kidz with signed copies of these agreements upon their request. Hyper Kidz retains the right as a third-party beneficiary to enforce the terms of these agreements independently.
This requirement is fairly standard in franchising, as franchisors need to protect their proprietary information and trade secrets. By mandating specific forms and retaining enforcement rights, Hyper Kidz maintains control over how its confidential information is handled and protected by those working within the franchise system.