What is the Bang Cookies franchisee's obligation regarding the confidentiality of the Know-How?
Bang_Cookies Franchise · 2024 FDDAnswer from 2024 FDD Document
fidential Information. Franchisee agrees that competition by Franchisee, Owners, Spouses and/or Immediate Family Members could jeopardize the entire System and cause irreparable harm to Franchisor and franchisees of Bang Cookies Shops. Accordingly, Franchisee and Franchisee's Owners and Spouses agree to comply with the restrictive covenants set forth in this Article 6 and throughout this Agreement.
6.B. RESTRICTIVE COVENANTS: KNOW-HOW
Franchisee agrees that, at all times, both during the Term of this Agreement and after its expiration or termination, Franchisee: (a) shall not use the Know-How in any business or capacity other than the operation of the Franchised Business pursuant to this Agreement and as instructed by Franchisor; (b) shall maintain the confidentiality of the Know-How at all times; (c) shall not make unauthorized copies of documents containing any Know-How; (d) shall take all reasonable steps that Franchisor requires from time
to time to prevent unauthorized use or disclosure of the Know-How; and (e) shall stop using the Know-How immediately upon the expiration, termination or Transfer of this Agreement.
Source: Item 23 — RECEIPTS (FDD pages 56–245)
What This Means (2024 FDD)
According to Bang Cookies's 2024 Franchise Disclosure Document, franchisees have specific obligations regarding the confidentiality of the Know-How, both during the term of the Franchise Agreement and after its expiration or termination. The franchisee must not use the Know-How in any business other than the operation of their Bang Cookies shop as instructed by the franchisor. They are required to maintain the confidentiality of the Know-How at all times and must not make unauthorized copies of any documents containing it.
Bang Cookies requires franchisees to take all reasonable steps that the franchisor requests to prevent unauthorized use or disclosure of the Know-How. Upon expiration, termination, or transfer of the Franchise Agreement, the franchisee must immediately stop using the Know-How. These obligations extend not only to the franchisee but also to the franchisee's owners and spouses, who must each execute and deliver a Franchise Owner and Spouse Agreement and Guaranty.
Furthermore, these confidentiality obligations apply to the franchisee's directors, officers, employees, and agents if disclosure of the Know-How was necessary for the operation of the franchised business. In such cases, the director, officer, employee, or agent must have previously executed and delivered a Confidentiality Agreement to Bang Cookies. This ensures that all parties with access to the Know-How are legally bound to protect its confidentiality, safeguarding Bang Cookies's proprietary information and competitive advantage.