Do officers and directors of a business entity franchisee need to sign the Kidokinetics Non-Disclosure and Non-Compete Agreement?
Kidokinetics Franchise · 2024 FDDAnswer from 2024 FDD Document
Your Manager and all other managerial personnel who will have access to our proprietary and Confidential Information and training must sign our Non-Disclosure and Non-Compete Agreement, which is attached to our Franchise Agreement as Attachment F. Additionally, if you are a business entity, all of your officers, directors, and direct and indirect equity holders, and those of any business entity that directly or indirectly controls you must sign the Non-Disclosure and Non-Compete Agreement.
Source: Item 15 — OBLIGATION TO PARTICIPATE IN THE ACTUAL OPERATION OF THE FRANCHISE BUSINESS (FDD page 39)
What This Means (2024 FDD)
According to Kidokinetics's 2024 Franchise Disclosure Document, if the franchisee is a business entity, all officers, directors, and direct and indirect equity holders, including those of any business entity that directly or indirectly controls the franchisee, must sign the Non-Disclosure and Non-Compete Agreement. This agreement is attached to the Franchise Agreement as Attachment F.
This requirement ensures that all individuals in leadership positions within a Kidokinetics franchise, who have access to the company's confidential information and trade secrets, are legally bound to protect that information and refrain from competing with Kidokinetics. This is a standard practice in franchising to safeguard the franchisor's business model and proprietary information.
Furthermore, the Non-Disclosure and Non-Compete Agreement extends beyond just officers and directors to include direct and indirect equity holders, broadening the scope of individuals bound by these restrictions. This comprehensive approach aims to prevent confidential information from leaking out through various channels and to minimize the risk of competition from individuals closely associated with the Kidokinetics franchise. Prospective franchisees should carefully review Attachment F to fully understand the terms and implications of this agreement.