What are the Bang Cookies franchisee's obligations regarding confidential information at all times?
Bang_Cookies Franchise · 2024 FDDAnswer from 2024 FDD Document
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 Confidential Information in any business or capacity other than the Bang Cookies Shop operated by Franchisee; (b) shall maintain the confidentiality of the Confidential Information at all times; (c) shall not make unauthorized copies of documents containing any Confidential Information; (d) shall take such reasonable steps as Franchisor may ask of Franchisee from time to time to prevent unauthorized use or disclosure of the Confidential Information; and (e) shall stop using the Confidential Information immediately upon the expiration, termination or Transfer of this Agreement. Franchisee agrees that the foregoing covenants and obligations shall also apply to: (a) Franchisee's Owners and Spouses and that Franchisee's Owners and Spouses shall each execute and deliver to Franchisor the Franchise Owner and Spouse Agreement and Guaranty in the form attached to this Agreement as Exhibit 1; and (b) Franchisee's directors, officers, employees and agents where disclosure of the Confidential Information was necessary for the operations of the Franchised Business and where such director, officer, employee and/or agent previously executed and timely delivered to Franchisor the Confidentiality Agreement in the form attached as Exhibit 2.
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 confidential information, both during the term of the Franchise Agreement and after its expiration or termination. These obligations are designed to protect Bang Cookies's proprietary information and maintain the brand's competitive advantage. Franchisees must not use confidential information in any business other than their Bang Cookies shop. They are required to maintain the confidentiality of the information at all times and prevent unauthorized use or disclosure.
The definition of "Confidential Information" is broad, encompassing trade secrets, methods, standards, techniques, procedures, data, and information related to the development, marketing, and operation of Bang Cookies shops. This includes consumer preferences, supplier information, customer lists, email lists, financial data, Business Management System Data, the contents of the operations manual, and Know-How. The franchisee is prohibited from making unauthorized copies of documents containing confidential information. Upon termination or transfer of the Franchise Agreement, the franchisee must immediately cease using the confidential information.
These obligations extend not only to the franchisee but also to their owners, spouses, directors, officers, employees, and agents. Owners and spouses must execute a Franchise Owner and Spouse Agreement and Guaranty, while directors, officers, employees, and agents who have access to confidential information must sign a Confidentiality Agreement. Franchisees also have a responsibility to notify Bang Cookies of any known or suspected breaches of the Confidentiality Agreement and to take reasonable steps to prevent violations.
Failure to comply with these confidentiality obligations can have serious consequences, potentially leading to termination of the Franchise Agreement and legal action. Bang Cookies also requires franchisees to disclose any ideas, concepts, methods, and products conceived or developed by the franchisee or their affiliates related to Bang Cookies shops, assigning these to the franchisor without any obligation for payment. This ensures that all innovations within the Bang Cookies system benefit the brand as a whole and remain protected as confidential information.