Must the confidentiality agreements for Alloy personnel identify Alloy as a third-party beneficiary?
Alloy Franchise · 2025 FDDAnswer from 2025 FDD Document
You and your Owners, officers, directors, shareholders, partners, members and managers (if any) acknowledge that your entire knowledge of the operation of an ALLOY Facility and the System, including the knowledge or know-how regarding the specifications, standards and operating procedures of the services and activities, is derived from information we disclose to you and that certain information is proprietary, confidential and constitutes our trade secrets. The term "trade secrets" refers to the whole or any portion of know-how, knowledge, methods, specifications, processes, procedures and/or improvements regarding the business that is valuable and secret in the sense that it is not generally known to our competitors and any proprietary information contained in the Manuals or otherwise communicated to you in writing, verbally or through the Internet or other online or computer communications, and any other knowledge or knowhow concerning the methods of operation of the Facilities. You and your Owners, officers, directors, shareholders, partners, members and managers (if any), jointly and severally, agree that at all times during and after the term of this Agreement, you will maintain the absolute confidentiality of all such proprietary information and will not disclose, copy, reproduce, sell or use any such information in any other business or in any manner not specifically authorized or approved in advance in writing by us. We may require that you obtain nondisclosure and confidentiality agreements in a form satisfactory to us from the individuals identified in the first sentence of this paragraph and other key employees.
Source: Item 14 — PATENTS, COPYRIGHTS AND PROPRIETARY INFORMATION (FDD pages 48–49)
What This Means (2025 FDD)
According to the 2025 Alloy FDD, Alloy may require franchisees to obtain nondisclosure and confidentiality agreements from certain individuals. These individuals include the franchisee's Owners, officers, directors, shareholders, partners, members, managers, and other key employees. The FDD specifies that these agreements must be in a form satisfactory to Alloy.
However, the FDD does not explicitly state that Alloy must be identified as a third-party beneficiary in these confidentiality agreements. While Alloy retains the right to approve the form of the agreement, the document does not specify this particular requirement.
Therefore, prospective Alloy franchisees should clarify with the franchisor whether Alloy requires third-party beneficiary status in the confidentiality agreements for their personnel. This clarification will ensure compliance with Alloy's requirements and protect the franchisor's interests in maintaining the confidentiality of its proprietary information.