Does the Afuri Ramen Dumpling franchise agreement include a confidentiality and non-competition agreement?
Afuri_Ramen_Dumpling Franchise · 2024 FDDAnswer from 2024 FDD Document
. Except in connection with an Afuri franchise, you will never communicate, divulge, or use in any manner, either for your benefit or the benefit or any other person, persons, partnerships, associations, companies or corporations any Confidential Information or proprietary information, knowledge or know-how concerning the System or any information we have communicated to you in written, verbal or electronic form, including intranet passwords, for the operation of your business.
- 3 COVENANT OF NON-USE. You agree not to use Confidential Information or the System, except as authorized by us. You will obligate your owners, board of directors, your employees, and your agents to the same non-use covenant. We must approve in writing any use of Confidential Information or System by you or your owners or your directors or employees.
- 4 RETURN OF CONFIDENTIAL INFORMATION. You agree that all originals and copies of records, data, reports, documents, lists, plans, drawings, correspondence, memoranda, notes, and other materials related to or containing any Confidential Information, in whatever form they exist, whether written, visual, audio, video, or other form of media, shall be our sole and exclusive property. Upon request by us, you will promptly return to us all documents or other tangible property that contains Confidential Information.
- 5 RECIPES. Without limiting the generality of the non-disclosure and non-use provisions in this Agreement, you specifically agree not to disclose or use our recipes (by yourself or by or through any other entity or individual) in any manner other than in connection with Afuri franchises pursuant to the Franchise Agreement.
6 NON-COMPETITION COVENANT.
6.1 Covenant. During the term of your association with Franchisee and for two years thereafter, you will not directly or indirectly (including by or through any other person or entity) participate as an owner, director, officer, employee, consultant, licensor, licensee, distributor, or agent, or serve in any other capacity in any business engaged in the offer, sale, or promotion of: (1) ramen, (2) other Japanese style cuisine, (3) Vietnamese pho, or (4) any business that offers products or services that are essentially the same as, or substantially similar to, the products and services that are part of the
System.
- 6.2 Geographic Scope. During the term of your association with Franchisee, the covenants described in Section 6.1 above shall apply worldwide. During the two-year period after your association with Franchisee, such covenants will apply within the Development Territory, within a 50-mile radius of the Development Territory, and within a 50-mile radius of any location or designated territory where we operate or have granted the franchise to operate an Afuri business.
- 7 NON-DIVERSION OF BUSINESS.
Source: Item 23 — Receipts (FDD pages 50–189)
What This Means (2024 FDD)
Yes, according to the 2024 Afuri Ramen Dumpling Franchise Disclosure Document, the franchise agreement includes both confidentiality and non-competition covenants. Afuri Ramen Dumpling requires franchisees and their owners, directors, employees, and agents to agree not to use confidential information or the System, except as authorized. This obligation extends to not disclosing or using Afuri Ramen Dumpling's recipes outside of the franchise agreement. Franchisees must return all materials containing confidential information upon request.
During the term of the franchise and for two years after, franchisees are restricted from participating in businesses that offer ramen, other Japanese cuisine, Vietnamese pho, or any business offering similar products or services to the Afuri Ramen Dumpling System. This non-competition covenant prevents franchisees from leveraging the franchisor's expertise and trade secrets to compete against the system, ensuring the brand's integrity and market position are protected.
However, there are exceptions to these covenants. If a franchisee operates a pre-existing business, they may continue to operate it, even if it competes with Afuri Ramen Dumpling, notwithstanding the in-term and post-term non-competition covenants. It is important to note that the confidentiality and nondisclosure covenants of the Franchise Agreement are not affected by this Addendum and remain in full force and effect.