For Anago, what is the Subfranchisor required to do to protect Confidential Information?
Anago Franchise · 2025 FDDAnswer from 2025 FDD Document
cause its Unit Franchisees to do so, at his or her sole cost and expense within 30 days of Franchisor's request.
ARTICLE 6 - MANUALS AND OTHER CONFIDENTIAL INFORMATION
Section 6.1 - Confidential Use
Subfranchisor will receive valuable training regarding the operation and maintenance of the Subfranchise Business, Unit Franchise Businesses and Confidential Information which are beyond the present skills, experience and knowledge of Subfranchisor, or any of its owners, principals, managers or employees. The Confidential Information provided by Franchisor in connection with this Agreement constitutes valuable, essential, necessary and indispensable information that Subfranchisor requires and every restriction imposed on Subfranchisor and its principals in this Article 6 constitutes measures necessary to maintain the identity, integrity and reputation of the System. Consequently, Subfranchisor and each of its principals, owners, managers and employees will at all times treat the Anago Manuals and any other Confidential Information as confidential, and will use best efforts to preserve the confidentiality of all Confidential Information. The Anago Manuals will, at all times, be kept in a secure area at Subfranchisor's offices. Subfranchisor will report the theft, loss or destruction of the Anago Manuals, or any portion of the Manuals, immediately to Franchisor. Upon the theft, loss or destruction of the Anago Manuals, a replacement set must be purchased by Subfranchisor from Franchisor at a cost of $500. Moreover, Subfranchisor agrees that designated portions of the Anago Manuals are "trade secrets" held and treated as "trade secrets" by Franchisor. Subfranchisor will strictly limit access to the Anago Manuals to Subfranchisor's employees, to the extent they have a "need to know" in order to perform their jobs. Subfranchisor will not at any time, without Franchisor's written consent, copy, record or otherwise reproduce any part of the Anago Manuals, nor otherwise make the Anago Manuals available to any
unauthorized person except as may be required by law, regulation or court order. All current and future principals, employees and agents of Subfranchisor involved in any manner with his or her Subfranchise Business and having access to the Anago Manuals or any other Confidential Information, are required to sign before Initial Subfranchisor Training or upon employment, a nondisclosure and noninterference agreement.
Section 6.2 - Sole Property of Franchisor
The Anago Manuals and other Confidential Information at all times is and remains the sole property of Franchisor. Subfranchisor acquires no right, title or interest to this property under this Agreement except to possess and use the Anago Manuals or other Confidential Information during the Term of, and subject to the restrictions contained in, this Agreement. Therefore, Subfranchisor is prohibited from altering, editing or changing the Anago Manuals or any part of thereof. All improvements, developments, derivative works, enhancements, or modifications to any Confidential Information (collectively, "Innovations") made or created by Subfranchisor, its employees, contractors or Unit Franchisees, whether developed separately or in conjunction with Franchisor, shall be owned solely by Franchisor. Subfranchisor represents, warrants, and covenants that its employees, contractors and Unit Franchisees are bound by written agreements assigning all rights in and to any Innovations developed or created by them to Subfranchisor. To the extent that Subfranchisor, its employees, contractors or Unit Franchisees are deemed to have any interest in such Innovations, Subfranchisor hereby agrees to assign, and does assign, all right, title and interest in and to such Innovations to Franchisor. To that end, Subfranchisorshall execute, verify, and deliver such documents (including, without limitation, assignments) and perform such other acts (including appearances as a witness) as Franchisor may reasonably request for use in applying for, obtaining, perfecting, evidencing, sustaining, and enforcing such ownership rights in and to the Innovations, and the assignment thereof. Subfranchisor's obligation to assist Franchisor with respect to such ownership rights shall continue beyond the expiration or termination of this Agreement.
Source: Item 23 — RECEIPTS (FDD pages 62–298)
What This Means (2025 FDD)
According to Anago's 2025 Franchise Disclosure Document, the Subfranchisor has several obligations regarding confidential information. The Subfranchisor must treat the Anago Manuals and any other confidential information as confidential and use their best efforts to preserve its confidentiality. The Anago Manuals must be kept in a secure area at the Subfranchisor's offices, and any theft, loss, or destruction of the manuals must be reported immediately to Anago. If the manuals are lost or destroyed, the Subfranchisor must purchase a replacement set from Anago for $500. Access to the Anago Manuals should be strictly limited to employees with a need to know, and the Subfranchisor cannot copy or reproduce any part of the manuals without Anago's written consent. All principals, employees, and agents with access to the Anago Manuals or other confidential information must sign a nondisclosure and noninterference agreement before training or employment.
Additionally, the Subfranchisor must implement all necessary administrative, physical, and technical safeguards to protect personal information, including names, addresses, phone numbers, email addresses, employee identification numbers, signatures, passwords, financial information, credit card information, biometric or health data, government-issued identification numbers, and credit report information. It is the Subfranchisor's responsibility to ensure these safeguards comply with all applicable laws and industry best practices related to the collection, access, use, storage, disposal, and disclosure of personal information. Any suspected or actual breach of security or unauthorized access involving personal information must be reported to Anago immediately, specifying the extent of the compromise or disclosure.
The Subfranchisor also agrees not to provide or make available any portion of the Software, including documentation and machine-readable code, to any person other than the Subfranchisor's employees with a need to know such information and who are themselves bound to written confidentiality obligations. The Subfranchisor will not reverse assemble or reverse compile the Software in whole or in part. The Subfranchisor must also take all other steps necessary, at his or her own expense, to protect the Confidential Information and will not divulge Confidential Information either during, or upon the expiration or termination of, this Agreement without the written consent of Franchisor.
These measures are designed to protect Anago's valuable proprietary information and maintain the integrity of the Anago system. Failure to comply with these confidentiality obligations can result in a material breach of the Subfranchise Agreement.