What must a Learningrx franchisee do to prevent unauthorized use of confidential information?

• 7.3 Unauthorized Use. Franchisee must not copy or otherwise reproduce any Confidential Information and must establish procedures to prevent unauthorized use by any other person. Unauthorized use of the Operations Manual or the System will constitute a breach of this Agreement and an infringement of our proprietary rights, including trade secrets and copyrights. You must promptly report any unauthorized use of the Operations Manual or other Confidential Information.
• 7.1 Confidential Information. The System, the Operations Manual, and other Confidential Information are proprietary, involve trade secrets of Franchisor, and are disclosed to Franchisee solely on the express condition that Franchisee agrees, and Franchisee does hereby agree to:
• (a) fully and strictly adhere to all security procedures prescribed by Franchisor, in its sole discretion, for maintaining the proprietary information as confidential;
• (b) disclose such information to its employees only to the extent necessary to market products and services and for the operation of the Business in accordance with this Agreement;
• (c) not use any such information in any other business or in any manner not specifically authorized or approved in writing by Franchisor; and
• (d) exercise the highest degree of diligence and make every effort to maintain the absolute confidentiality of all such information during and after the term of this Agreement, and follow Franchisor's security procedures, which include the execution of approved nondisclosure agreements, and intranet, extranet and Internet usage agreements when developed by Franchisor, by Franchisee and any employee or agent who is allowed access.
• 7.2 Standards and Authorized Use. Franchisee must maintain strict compliance with the minimal standards set forth in the Operations Manual and as subsequently amended and revised in Franchisor's sole discretion, including completing a background check for each of its employees, as more fully set forth in the Operations Manual.
• (b) comply with the data protection, collection, maintenance and use requirements for Customer Data set out in the Operations Manual and this Franchise Agreement, including all policies, procedures and controls that Franchisor implements now or in the future;
• (c) comply with all applicable federal, state and local statutes, regulations, ordinances and requirements, including but not limited to, the California Consumer Privacy Act, relating to the data protection, collection, maintenance and use of Customer Data (collectively, "Privacy Laws");
• (e) promptly notify Franchisor in writing of any Security Incident (defined below) that Franchisee becomes aware of or discovers. Franchisee must also take reasonable steps to verify that Franchisee's suppliers, lenders, landlords, customers, and governmental agencies on which Franchisee relies, are reasonably protected. This may include taking reasonable steps to secure Franchisee's systems, including, but not limited to, firewalls, access code protection, anti-virus systems, and use of backup systems. WHEREAS, Franchisee has agreed to obtain from those Spousal Affiliates written agreements protecting the Trade Secrets and the System against unfair competition; and, All Operations Manuals are loaned by Franchisor to Franchisee for limited purposes only and remain the property of Franchisor and may not be reproduced, in whole or in part, without Franchisor's written consent.

Source: Item 23 — RECEIPT (FDD pages 54–209)