What is the duration of the Belocal franchisee's obligation to protect Confidential Information?
Belocal Franchise · 2025 FDDAnswer from 2025 FDD Document
:
- (1) Use the Confidential Information exclusively in conjunction with the operation of the Franchised Business and to carry out the obligations of Franchisee pursuant to the terms of this Agreement and not for any other purpose, and shall refrain from disclosing the Confidential Information to any third person or entity not directly associated with Franchisee, except as may be required by law. In the event Franchisee, any Principal, or any persons to whom any Confidential Information was lawfully disclosed become legally compelled (by deposition, interrogatory, request for documents, subpoena, civil investigative demand, or similar process) to disclose any of the Confidential Information, Franchisee and Principals shall provide Franchisor with prompt prior written notice of such requirement so that Franchisor may seek a protective order or other appropriate remedy and/or waive compliance with the terms hereof. In the event that such protective order or other remedy is not obtained, or that Franchisor waives compliance with the provisions hereof, Franchisee and Principals agree to furnish only that portion of the Confidential Information which Franchisee and/or Principals are advised by written opinion of counsel is legally required and to exercise best efforts to obtain assurance that confidential treatment will be accorded such disclosed Confidential Information;
- (2) Ensure that all counsel, accountants, and other representatives of Franchisee and/or Principals who are given access any Confidential Information on behalf of Franchisee or any Principal comply with the confidentiality provisions of this Agreement. Franchisee and each Principal are, jointly and severally, fully responsible for any breach of this Agreement by any person to whom access to the Confidential Information is given by Franchisee, any Principals, or any of their representatives;
- (3) Not make any copies of the Confidential Information for any purpose that is not directly related to the Franchised Business;
- (4) Not upload or download, or attempt to upload or download, any Confidential Information that is not directly related to the Franchised Business; and
- (5) Upon termination, expiration, or transfer of this Agreement, promptly return to Franchisor all Confidential Information and all copies thereof.
For clarity, any attempt by Franchisee (using any method) to upload, download, or copy into any format any Confidential Information that is not directly related to the Franchised Business, including without limitation, client and advertiser information, shall constitute grounds for immediate termination of this Agreement.
B. In-term Noncompetition. Franchisee and Owners represent that they are not currently working with or for any Person engaged in any Competitive Business (as defined in Section 7.G. below). Franchisee and each Owner specifically acknowledge that they will receive valuable Confidential Information beyond their present skills and experience and that such Confidential Information provides a competitive advantage. In consideration for gaining access to Confidential Information, the use of the Marks, and other valuable consideration associated with the grant of the right to operate the Franchised Business, Franchisee and each Owner agree that, during the Term of this Agreement, neither Franchisee nor any Owner shall, for themselves, or through or on behalf of or in conjunction with any other person or entity, own, maintain, operate or engage in any Competitive Business or provide any Competitive Services
at any location within the United States, its territories or commonwealths, or any other country, province, state, or geographic area in which Franchisor or its affiliates have used, sought registration of, or registered the Marks or similar marks or operated or granted others (including other of Franchisor's franchisees) the right to operate a business under the Marks or similar marks.
- C. In-term Non-solicitation.
Source: Item 22 — CONTRACTS (FDD page 71)
What This Means (2025 FDD)
According to Belocal's 2025 Franchise Disclosure Document, the franchisee has ongoing obligations to protect confidential information, even after the franchise agreement terminates. Upon termination, expiration, or transfer of the agreement, the franchisee must promptly return to Belocal all confidential information and any copies of it.
Belocal defines "Confidential Information" broadly to include any oral, visual, or written information related to Belocal, its affiliates, the franchised business, and any publication furnished by Belocal to the franchisee. This includes, but is not limited to, trademarks, trade names, service marks, trade secrets, research, plans, products, services, customer lists, supplier information, advertisers, business plans, marketing data and materials, software, electronic code, forms, processes, methods of operation, strategic information, financial information, and manuals.
The franchisee must use the confidential information exclusively for operating the franchised business and fulfilling their obligations under the franchise agreement. They are prohibited from disclosing it to any third party not directly associated with the franchisee, unless required by law. The franchisee is responsible for ensuring that anyone they allow access to confidential information, such as counsel or accountants, also complies with the confidentiality provisions. The franchisee is liable for any breaches of the agreement by those they grant access to the information.
Any unauthorized attempt to upload, download, or copy confidential information, especially client and advertiser data, is grounds for immediate termination of the Belocal franchise agreement. This highlights the critical importance Belocal places on safeguarding its proprietary information and the potential consequences for franchisees who fail to do so.