What happens to the franchisee's obligations regarding trade secrets after the All Team franchise agreement terminates?
All_Team Franchise · 2025 FDDAnswer from 2025 FDD Document
X. TRADE SECRETS
FRANCHISEE shall not, during the term of this Agreement, or after termination, expiration of the Agreement or Transfer, communicate or divulge to anyone, any information or knowledge concerning the products, services, standards, procedures, techniques, sales information, profit margins, marketing procedures, expansion plans, clients, rates, fees and terms and other information or material which ATFC may designate as confidential, including the Confidential Operations Manual, nor shall FRANCHISEE disclose or divulge in whole or in part any trade secrets or operating procedures of ATFC or its affiliates, customer lists, sales and promotional information, employee lists, financial information furnished or disclosed to FRANCHISEE by ATFC and any other information with respect of ATFC, unless such information is generally known and in the public domain, and except to the extent necessary to operate the Agency ("Confidential Information"). All employees of FRANCHISEE will exercise the highest degree of diligence and make every effort to maintain the absolute confidentiality of all trade secrets and proprietary rights during and after the term of this Agreement, and shall require all supervisory personnel to execute a Confidentiality and Non-Compete Agreement in a form acceptable to ATFC.
Source: Item 22 — CONTRACTS (FDD pages 33–34)
What This Means (2025 FDD)
According to All Team's 2025 Franchise Disclosure Document, the franchisee's obligation to maintain the confidentiality of trade secrets extends beyond the termination or expiration of the franchise agreement. Specifically, the franchisee is prohibited from communicating or divulging any confidential information or trade secrets of All Team, including but not limited to products, services, standards, procedures, techniques, sales information, profit margins, marketing procedures, expansion plans, clients, rates, fees, terms, the Confidential Operations Manual, customer lists, sales and promotional information, employee lists, and financial information. This obligation continues even after the franchise agreement ends. The only exception to this is if the information is generally known and in the public domain, or if disclosure is necessary to operate the Agency.
All Team also requires that all employees of the franchisee maintain the absolute confidentiality of all trade secrets and proprietary rights both during and after the term of the agreement. Furthermore, supervisory personnel must execute a Confidentiality and Non-Compete Agreement in a form acceptable to All Team. This ensures that the protection of confidential information extends beyond just the franchisee to also include those working within the franchise.
This clause is typical in franchise agreements to protect the franchisor's proprietary information and maintain a competitive advantage. A prospective All Team franchisee should carefully review the definition of "Confidential Information" in the franchise agreement to fully understand the scope of their obligations and ensure they can comply with these restrictions both during and after the franchise term.