What agreement outlines the terms of confidentiality and covenant not to compete for Learningrx franchisees?
Learningrx Franchise · 2025 FDDAnswer from 2025 FDD Document
7.5 Confidentiality and Covenant Not to Compete Agreements.
- (a) If the Franchisee is an entity, then the following individuals must sign Franchisor's standard Confidentiality & Covenant Not to Compete Agreement (Attachment IX) before performing any work at the Business or otherwise having access to Franchisor's Confidential Information: each Member, shareholder, officer, director and partner of the entity, each spouse of such Member, shareholder, officer, director and partner, every manager of the Franchisee or Area Developer, each Guarantor of the Franchisee, the spouse of each Guarantor, and each employee having access to the Franchisor's confidential information.
- (b) If the Franchisee is not an entity, then the following individuals must sign Franchisor's standard Confidentiality & Covenant Not to Compete Agreement (Attachment IX) before performing any work at the Business or otherwise having access to Franchisor's Confidential Information: the spouse of the Franchisee, every manager of the Franchisee, each Guarantor of the Franchisee, the spouse of each Guarantor, and each employee having access to the Franchisor's confidential information. A copy of all such signed agreements shall be delivered to Franchisor within 1 week of their execution.
Source: Item 23 — RECEIPT (FDD pages 54–209)
What This Means (2025 FDD)
According to Learningrx's 2025 Franchise Disclosure Document, the terms of confidentiality and the covenant not to compete are outlined in the standard Confidentiality & Covenant Not to Compete Agreement, which is included as Attachment IX to the franchise agreement. This agreement is crucial for protecting Learningrx's trade secrets, system, and goodwill. The agreement specifies who must sign it, depending on whether the franchisee is an entity or an individual.
If the Learningrx franchisee is an entity, the agreement must be signed by each member, shareholder, officer, director, and partner of the entity, as well as their spouses. It also extends to every manager of the franchisee or area developer, each guarantor of the franchisee and their spouse, and each employee who has access to Learningrx's confidential information. If the franchisee is not an entity, the agreement must be signed by the franchisee's spouse, every manager, each guarantor and their spouse, and each employee with access to confidential information.
Learningrx requires that a copy of all signed agreements be delivered to the franchisor within one week of their execution. This ensures that all relevant parties are legally bound to protect Learningrx's interests. The agreement aims to prevent individuals associated with the franchisee from engaging in activities that could harm the Learningrx business, such as working for a competitor or disclosing confidential information. Prospective franchisees should carefully review Attachment IX to understand the full scope of these obligations and ensure compliance.