factual

What must a Management Recruiters franchisee do with Trade Secrets upon termination or expiration of the Franchise Agreement?

Management_Recruiters Franchise · 2024 FDD

Answer from 2024 FDD Document

  • 21.3. Trade Secrets. Upon termination or expiration of this Agreement, Franchisee shall immediately cease to use any of the Trade Secrets disclosed to Franchisee pursuant to this Agreement. Upon such termination or expiration, Franchisee shall immediately return to Franchisor all confidential or proprietary materials that Franchisor has loaned to Franchisee. Franchisee's continued use of any of the Trade Secrets or any other confidential or proprietary materials or information following the expiration of this

  • 16.1. Trade Secrets. Franchisee agrees that all Trade Secrets are and will remain the confidential and trade secret property of Franchisor. Upon expiration or termination of this Agreement for any reason, and as a condition precedent to receiving payment of any sums due from Franchisor upon such expiration or termination, Franchisee shall immediately return to Franchisor all material containing Trade Secrets, including all copies thereof and shall provide Franchisor with a sworn affidavit confirming that it has fully complied with this Section 16.

  • 16.2. Limits on Use. Franchisee acknowledges and agrees that ownership of all rights, title and interest in the Trade Secrets are and shall remain vested solely in Franchisor and Franchisee disclaims any right or interest therein or the goodwill derived therefrom. Franchisee shall acquire no interest in the Trade Secrets other than the right to use them in developing and conducting the Franchise Business during this Agreement's Term. Franchisee shall not challenge or contest the rights, title, or interest of Franchisor in and to the Trade Secrets. Franchisee's duplication or use of the Trade Secrets in any other endeavor or business shall constitute an unfair method of competition. Franchisee shall:

    • not use the Trade Secrets in any business or other endeavor other than in connection with the Franchise Business;
    • maintain absolute confidentiality of the Trade Secrets during and after this Agreement's term;
    • make no unauthorized copy of any portion of the Trade Secrets, including, without limitation, the Brand Standards Materials, bulletins, supplements, forms such as customer applications and applications for temporary personnel, confidential correspondence, or other confidential communications, whether written or oral; and
    • implement, maintain, and diligently utilize all reasonable procedures prescribed from time to time by Franchisor to prevent unauthorized use and disclosure of the Trade Secrets, including, without limitation, restrictions on disclosure to employees and use of nondisclosure and non-competition provisions as Franchisor prescribes in employment agreements with employees who may have

Source: Item 23 — RECEIPTS (FDD pages 67–327)

What This Means (2024 FDD)

According to Management Recruiters' 2024 Franchise Disclosure Document, upon termination or expiration of the Franchise Agreement, a franchisee must immediately cease using any of the Trade Secrets disclosed to them. Additionally, the franchisee must promptly return all confidential or proprietary materials that Management Recruiters has loaned to them. Continued use of Trade Secrets or any other confidential materials after the agreement's termination or expiration constitutes an unfair method of competition.

As a condition for receiving any payments due from Management Recruiters upon expiration or termination, the franchisee must immediately return all materials containing Trade Secrets, including all copies. They must also provide a sworn affidavit confirming full compliance with this requirement.

Management Recruiters also requires franchisees to maintain absolute confidentiality of the Trade Secrets both during and after the agreement's term. Franchisees are prohibited from using the Trade Secrets in any business other than the Franchise Business and must implement procedures to prevent unauthorized use and disclosure, including using non-disclosure and non-competition agreements with employees who have access to the Trade Secrets.

Disclaimer: This information is extracted from the 2024 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.