What is the required form for the confidentiality covenants that Benihana franchisees must have their General Manager and personnel sign?
Benihana Franchise · 2024 FDDAnswer from 2024 FDD Document
- (b) As a condition of employment, Franchisee shall require Franchisee's General Manager and any personnel having access to any Confidential Information to execute covenants that they will maintain the confidentiality of information they receive in connection with their employment at the Restaurant.
Such covenants shall be in the form attached to this Agreement as Exhibit F, which form includes specific
identification of BNC as a third party beneficiary of such covenants with the independent right to enforce them. Franchisee shall provide BNC with a copy of all executed covenants within five days after hiring any such General Manager and/or employees.
Source: Item 22 — CONTRACTS (FDD pages 73–74)
What This Means (2024 FDD)
According to Benihana's 2024 Franchise Disclosure Document, franchisees must ensure that their General Manager and any personnel with access to confidential information sign confidentiality covenants as a condition of employment. These covenants must be in the form attached to the Franchise Agreement as Exhibit F.
The agreement specifies that Benihana is a third-party beneficiary of these covenants, granting Benihana the independent right to enforce them. Franchisees are required to provide Benihana with copies of all executed covenants within five days of hiring the General Manager or relevant employees.
This requirement ensures that Benihana's confidential information and trade secrets are protected, as the General Manager and other key personnel are legally bound to maintain confidentiality. The inclusion of Benihana as a third-party beneficiary strengthens their ability to take direct legal action if these covenants are breached, safeguarding their business interests and the integrity of the Benihana system.
Prospective franchisees should carefully review Exhibit F to understand the specific terms and obligations of these confidentiality agreements. They should also factor in the administrative task of collecting and submitting these signed agreements to Benihana within the specified timeframe.