During the Hyper Kidz franchise term, how will I receive Confidential Information?
Hyper_Kidz Franchise · 2024 FDDAnswer from 2024 FDD Document
Under the Franchise Agreement we will disclose to you, during training and in guidance and assistance furnished to you, parts of the Confidential Information that you need for the development and operation of a Hyper Kidz Business. You may learn or otherwise obtain from us additional Confidential Information during the term of your Franchise Agreement. You must agree to disclose the Confidential Information to your Principals and employees only to the extent reasonably necessary to operate your Franchised Business.
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, Confidential Information will be disclosed to franchisees during training, as well as through ongoing guidance and assistance provided throughout the franchise term. This information is deemed necessary for the development and operation of a Hyper Kidz Business. Franchisees may also gain access to additional Confidential Information as the franchise agreement progresses.
Hyper Kidz requires franchisees to limit the disclosure of Confidential Information to only those principals and employees who need it to operate the franchised business. Both the franchisee and their principals must acknowledge that this Confidential Information is a valuable asset belonging to Hyper Kidz and its affiliates, which includes trade secrets.
To protect this information, Hyper Kidz mandates that franchisees and their personnel agree to several conditions, including not using the Confidential Information in any other business, maintaining its absolute confidentiality, and preventing unauthorized copies. Franchisees must also implement reasonable procedures to prevent unauthorized use or disclosure and ensure that all principals and employees with access to the information sign confidentiality and non-competition agreements. These agreements benefit Hyper Kidz as a third party, allowing them to enforce the terms directly.
These measures are typical in franchising, as franchisors need to protect their proprietary information and trade secrets. Prospective Hyper Kidz franchisees should carefully review the scope of the Confidential Information and the restrictions on its use and disclosure to fully understand their obligations.