Does the Beggars Pizza franchise agreement require franchisees to maintain the confidentiality of information after the term of the agreement?
Beggars_Pizza Franchise · 2025 FDDAnswer from 2025 FDD Document
10. CONFIDENTIAL INFORMATION
- 10.1 Confidential Information. Franchisee will not, during the term of the Agreement or thereafter, communicate, divulge or use for the benefit of any other person, partnership, association, limited liability company, or corporation any confidential information, knowledge or know-how concerning the methods of operation of the System including, without limitation, the Manual, recipes, ingredients, cooking procedures, customer lists, drawings, materials, or equipment which may be communicated to Franchisee or of which Franchisee may be apprised by virtue of Franchisee's operation under the terms of the Agreement ("Confidential Information"). Franchisee will divulge such Confidential Information only to such of its employees as must have access to it in order to operate the Restaurant. Any information, knowledge, know-how, techniques, and other data that Franchisor designates as confidential will be deemed confidential for the purposes of the Agreement. Notwithstanding the foregoing, nothing in the Agreement prohibits Franchisee from disclosing confidential information directly to a federal or state regulatory agency, law enforcement authority, or legislative body to the extent necessary to report potential violations of applicable law or assist in governmental investigative, enforcement, or oversight efforts.
- 10.2 Confidentiality Agreements. At Franchisee's request, Franchisee must require Franchisee's managers and other such personnel having access to any Confidential Information as Franchisor requires to execute non-competition covenants and covenants that they will maintain the confidentiality of information they receive in connection with their employment by Franchisee at the Restaurant. Such covenants must be in the form attached hereto as Exhibit C.
10.3 Irreparable Injury. Franchisee acknowledges that any failure to comply with the requirements of this Section 10 will cause Franchisor irreparable injury, and Franchisee must pay all court costs and reasonable attorneys' fees incurred by Franchisor in obtaining specific performance of, or an injunction against violation of, the requirements of this Section 10 or such other relief sought by Franchisor.
Source: Item 22 — CONTRACTS (FDD page 39)
What This Means (2025 FDD)
According to the 2025 Beggars Pizza Franchise Disclosure Document, franchisees are obligated to maintain the confidentiality of certain information both during and after the term of the franchise agreement. Specifically, section 10.1 of the agreement states that franchisees cannot communicate, divulge, or use confidential information for the benefit of any other entity. This includes knowledge or know-how related to the System's methods of operation, such as the Manual, recipes, ingredients, cooking procedures, customer lists, drawings, materials, or equipment.
This obligation extends beyond the termination of the franchise agreement, meaning that even after a franchisee leaves the Beggars Pizza system, they are still legally bound to protect this confidential information. The agreement allows franchisees to share confidential information only with employees who need access to it for the operation of the Restaurant. Beggars Pizza also designates any information, knowledge, know-how, techniques, and other data as confidential for the purposes of the agreement.
The franchise agreement also addresses the consequences of failing to comply with these confidentiality requirements. Section 10.3 states that any failure to comply with the confidentiality requirements will cause irreparable injury to Beggars Pizza. In such cases, the franchisee is responsible for all court costs and reasonable attorneys' fees incurred by Beggars Pizza in obtaining specific performance or an injunction against the violation. This highlights the importance Beggars Pizza places on protecting its confidential information and the potential legal and financial repercussions for franchisees who breach this obligation.