Does Azal Coffee represent or suggest that the provided Confidentiality and Noncompetition Agreement is the appropriate form for use by franchisees or that the form complies with the applicable laws in their jurisdiction?
Azal_Coffee Franchise · 2024 FDDAnswer from 2024 FDD Document
Attached as Exhibit E is a form of Confidentiality and Noncompetition Agreement approved by us for use by our franchisees. We provide this form as an example of the form of agreement acceptable to us; however, we do not represent or suggest that this is the appropriate form for use by you or that the form complies with the applicable laws in your jurisdiction. You should have any employee confidentiality and/or noncompetition agreement forms you intend to use reviewed by your attorney to ensure the form provides you with the protections that you desire and that the form complies with the applicable laws in your jurisdiction.
Source: Item 14 — PATENTS, COPYRIGHTS AND PROPRIETARY INFORMATION (FDD pages 39–41)
What This Means (2024 FDD)
According to Azal Coffee's 2024 Franchise Disclosure Document, while a form of Confidentiality and Noncompetition Agreement is provided as an example, Azal Coffee does not represent or suggest that this is the appropriate form for franchisees to use, nor does it claim that the form complies with the laws of any specific jurisdiction. The FDD emphasizes that franchisees may be required to have their employees sign confidentiality and/or non-competition agreements before disclosing confidential information to them.
The agreement used must be in a form approved by Azal Coffee, which retains the right to be a third-party beneficiary with independent enforcement rights. Exhibit E of the FDD contains a sample Confidentiality and Noncompetition Agreement that Azal Coffee finds acceptable. However, Azal Coffee explicitly advises franchisees to consult with their own attorneys to ensure that any employee confidentiality and/or noncompetition agreement forms they intend to use provide the desired protections and comply with applicable laws in their jurisdiction.
This disclaimer is a standard practice in franchising, as laws regarding non-compete agreements vary significantly by state and can be complex. It is the franchisee's responsibility to ensure legal compliance in their specific location. By recommending legal consultation, Azal Coffee shifts the onus of ensuring legal compliance to the franchisee, which is a common and prudent approach in franchise systems.