What is a prospective franchisee of Auntie Annes required to do with Confidential Information upon completion of their investigation?
Auntie_Annes Franchise · 2024 FDDAnswer from 2024 FDD Document
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- The undersigned agrees to use the Confidential Information (as defined below) to which he/she is exposed only in connection with the undersigned's investigation of an Auntie Anne's franchise and for no other purpose.
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- The undersigned agrees to maintain the Confidential Information in strictest confidence and not to copy, reproduce or otherwise transmit the Confidential Information without the Franchisor's prior written consent, which may be denied in the Franchisor's sole discretion.
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- The undersigned may not disclose or disseminate the Confidential Information to any third party without the Franchisor's prior written consent, except the undersigned may share the Confidential Information with his/her financial and legal advisors on a need to know basis only and only if such advisors agree to be bound by the terms and conditions of this Agreement.
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- At the Franchisor's request, upon the undersigned's completion of his/her investigation of an Auntie Anne's franchise, the undersigned agrees to return to the Franchisor all Confidential Information received by the undersigned or to otherwise dispose of it in accordance with the Franchisor's instructions.
For purposes of this Agreement, "Confidential Information" shall mean all financial, business, market and operating information of any kind to relating to the Auntie Anne's franchise program or the operation of an Auntie Anne's franchise, all recipe ingredients, operational methods and processes, shop layouts, equipment specifications, list of suppliers and vendors, financial information pertaining to the Franchisor, shop design criteria, shop location criteria, blueprints, operational and financial standards, and all related matters regarding Auntie Anne's businesses, whether communicated in writing or orally. "Confidential Information" does not include data, material or information: (i) which is known to the undersigned at the time of disclosure as demonstrated by the undersigned's files and records; (ii) becomes known to the undersigned from another source without confidentiality restrictions; or (iii) is or becomes part of the public domain through no act or omission by the undersigned.
Source: Item 22 — CONTRACTS (FDD page 106)
What This Means (2024 FDD)
According to Auntie Annes's 2024 Franchise Disclosure Document, a prospective franchisee is required to handle confidential information carefully during their investigation of the franchise opportunity. Specifically, the franchisee must use the confidential information solely for the purpose of evaluating the Auntie Annes franchise and for no other reason. They must maintain the confidentiality of the information, and they cannot copy, reproduce, or transmit it without prior written consent from Auntie Annes.
Furthermore, the prospective franchisee is prohibited from disclosing the confidential information to any third party without Auntie Annes's prior written consent. The exception to this rule is that the franchisee may share the information with their financial and legal advisors, but only if those advisors agree to be bound by the same confidentiality terms.
Upon completing their investigation of the Auntie Annes franchise, the prospective franchisee is obligated to either return all confidential information received to Auntie Annes or dispose of it according to Auntie Annes's instructions. This ensures that Auntie Annes maintains control over its proprietary information, regardless of whether the prospective franchisee decides to move forward with the franchise opportunity. This is a fairly standard practice in franchising, as franchisors need to protect their trade secrets and operational methods.
Confidential information includes all financial, business, market, and operating information relating to the Auntie Anne's franchise program, such as recipe ingredients, operational methods, shop layouts, equipment specifications, supplier lists, financial data, shop design criteria, location criteria, blueprints, and operational and financial standards. Information already known to the franchisee, obtained from another source without confidentiality restrictions, or already in the public domain is excluded from this definition.