Does the non-disclosure covenant in the Baya Bar agreement survive the termination of the agreement?
Baya_Bar Franchise · 2024 FDDAnswer from 2024 FDD Document
- 8.1 Confidential Information. Developer acknowledges and accepts that during the term of this Agreement, Developer will have access to Franchisor's trade secrets, including, but not limited to, recipes, methods, processes, customer lists, vendor partnerships and/or relationships, sales and technical information, financial information, costs, product prices and names, software tools and applications, website and/or email design, products, services, equipment, technologies and procedures relating to the operation of the Franchised Business; the Manual; methods of advertising and promotion; instructional materials; any other information which Franchisor may or may not specifically designate as "confidential" or "proprietary"; and the components of the System, whether or not such information is protected or protectable by patent, copyright, trade secret or other proprietary rights (collectively referred to herein as the "Confidential Information"). Developer shall not, during the term of this Agreement and thereafter, communicate or divulge to, or use for the benefit of, any other person or entity, and, following the expiration or termination of this Agreement, shall not use for Developer's own benefit, any Confidential Information that may be communicated to Developer or of which Developer may be apprised in connection with the development of Baya Bar outlets under the terms of this Agreement. Developer shall not at any time copy, duplicate, record or otherwise reproduce any Confidential Information, in whole or in part, or otherwise make the same available to any person, without Franchisor's prior written consent. The covenant in this Section 8.1 shall survive the expiration, termination or transfer of this Agreement or any interest herein and shall be perpetually binding upon Developer.
Source: Item 23 — RECEIPTS (FDD pages 56–189)
What This Means (2024 FDD)
According to Baya Bar's 2024 Franchise Disclosure Document, the non-disclosure covenant within the franchise agreement does indeed survive the termination, expiration, or transfer of the agreement. Specifically, the agreement states that the franchisee is exposed to Baya Bar's trade secrets and confidential information during the term of the agreement.
Following the termination or expiration of the agreement, the franchisee is prohibited from using this confidential information for their own benefit or divulging it to others. This includes, but is not limited to, recipes, methods, customer lists, vendor partnerships, sales and technical information, financial data, product pricing, software, website design, and other components of the Baya Bar system.
This covenant is perpetually binding, meaning it extends indefinitely beyond the term of the franchise agreement. The franchisee is obligated to take necessary steps to protect this confidential information and must notify Baya Bar if any confidential information is disclosed in violation of the agreement. This ensures that Baya Bar's proprietary information remains protected even after the franchise relationship ends.