What constitutes confidential information for a Browns Chicken franchise?

A. Brown possesses certain unique, confidential and proprietary information and trade secrets, including but not limited to the following categories of information, methods, techniques, procedures, and knowledge developed by Brown and/or its franchisees (the "Confidential Information"): (1) recipes, methods, procedures and techniques for preparing, packaging, serving and delivering chicken and other food products; (2) methods, techniques, specifications, procedures, information, systems and knowledge of and experience in the development, operation and franchising of BROWN'S Stores; (3) marketing programs; and (4) methods of training of managers and other personnel.

• B. Brown will disclose the Confidential Information to Franchisee during training, in the Operating Manual and in guidance and assistance furnished to Franchisee during the term of the Franchise. Franchisee acknowledges and agrees that he will not acquire any interest in the Confidential Information, other than the right to utilize it in the operation of the Store and that the use or duplication of the Confidential Information in any other business would constitute an unfair method of competition with Brown and other BROWN'S franchises.

• C. Franchisee acknowledges and agrees that the Confidential Information is a valuable asset of Brown, includes trade secrets of Brown and is disclosed to Franchisee solely on the condition that Franchisee agrees, and Franchisee does hereby agree, that he: (1) will not use the Confidential Information in any other business or capacity; (2) will maintain the absolute secrecy and confidentiality of the Confidential Information during and after the term of this Agreement; (3) will not make unauthorized copies of any portion of the Confidential Information disclosed in written form; and (4) will adopt and implement all reasonable procedures prescribed from time to time by Brown to prevent unauthorized use or disclosure of the Confidential Information, including without limitation, restrictions on disclosure thereof to employees of Franchisee, and the use of Brown's customary non-disclosure and/or non-competition clauses in employment agreements with employees who have access to the Confidential Information.

In connection with this obligation, Franchisee shall notify Brown of the name and address of each affiliate, officer, director, partner, supervisory employee and owner of Franchisee and shall update such information whenever necessary.

Such notification shall contain and have annexed thereto a copy of a confidentiality and noncompetition agreement in a form satisfactory to Brown, executed by the individual at the time he or she acquires an interest in or becomes associated with Franchisee in which such individual consents to be bound by the restrictive covenants contained in said agreement and to Brown's and Franchisee's enforcement of such covenants.

The obligations of Franchisee pursuant to this Section 14 shall survive the termination or expiration of this Agreement.

• **D.

Innovations.** All ideas, concepts, techniques, and marketing, advertising or other materials relating to a restaurant offering chicken, pasta, and sandwiches, whether or not protectable intellectual property and whether created by or for Franchisee or Franchisee's owners or employees, must be promptly disclosed to Brown and will be deemed to be Brown's sole and exclusive property, part of Brown's System, and works made-for-hire for Brown.

To the extent that any item does not qualify as a "work made-for-hire" for Brown, by this paragraph Franchisee assigns ownership of that item, and all related rights to that item, to Brown and agree to take whatever action (including signing assignment or other documents) Brown requests to evidence Brown's ownership or to help Brown in this regard.

Franchisee agrees that Brown shall have the perpetual right to use and authorize other BROWN's Stores to use such ideas, concepts, methods and techniques without further consideration to Franchisee.

• E. Customer List. The list of customers that Franchisee services during the term of this Franchise Agreement is Brown's Proprietary Information and property.

At the expiration or termination of this Franchise Agreement for any reason, Franchisee will promptly turn over to Brown the entire list of customers and Franchisee will make no further use of that list for any purpose whatsoever.

• F. Notwithstanding anything to the contrary contained in this Agreement, and provided Franchisee shall have obtained Brown's prior written consent, which consent shall not be unreasonably withheld, the restrictions on Franchisee's disclosure and use of the Confidential Information shall not apply to (a) the disclosure of the Confidential Information in judicial or administrative proceedings to the extent that Franchisee is legally compelled to disclose such information, provided Franchisee shall have used its best efforts, and shall have afforded Brown the opportunity, to obtain an appropriate protective order or other assurance satisfactory to

Brown of confidential treatment for the information required to be so disclosed; or (b) information, processes or techniques which are or become generally known in the restaurant industry, other than through disclosure by Franchisee.

Source: Item 22 — Contracts (FDD page 43)