When do the obligations set forth in the Caption By Hyatt confidentiality agreement terminate?
Caption_By_Hyatt Franchise · 2025 FDDAnswer from 2025 FDD Document
Except as otherwise set forth herein, the obligations set forth in this Agreement shall terminate upon the execution of definitive agreements between the parties with respect to the Transaction or two (2) years from the date of this Agreement, whichever occurs first; provided, however, that notwithstanding the termination of this Agreement, the confidentiality obligations of the Company with respect to a Hyatt Trade Secret shall continue until the later of (i) five (5) years from the date of this Agreement, and (ii) until such time that Hyatt has provided notice that the Hyatt Trade Secret is no longer deemed by Hyatt to be a trade secret.
Source: Item 23 — Receipts (FDD pages 85–349)
What This Means (2025 FDD)
According to the 2025 Caption By Hyatt Franchise Disclosure Document, the obligations within the confidentiality agreement typically end when definitive agreements are executed between the involved parties regarding the transaction or two years from the agreement's date, whichever comes first. However, there is an exception regarding Hyatt Trade Secrets. The confidentiality obligations for a Hyatt Trade Secret continue for either five years from the agreement date or until Hyatt notifies that the trade secret is no longer considered a trade secret, whichever is later.
For a prospective Caption By Hyatt franchisee, this means that while most confidentiality obligations have a defined term, those pertaining to Hyatt's Trade Secrets could extend significantly longer. This extended obligation ensures the protection of Hyatt's proprietary information, which is crucial for maintaining its competitive edge.
It is important for franchisees to understand what constitutes a Hyatt Trade Secret and the implications of this extended confidentiality period. Franchisees should seek clarification from Caption By Hyatt regarding the specific types of information considered trade secrets and the potential impact on their operations and future business activities. This understanding will help in managing their obligations and avoiding any unintentional breaches of the confidentiality agreement.
This type of clause is relatively standard in franchising, as franchisors need to protect their intellectual property and trade secrets. However, the specific terms can vary, so it's crucial for franchisees to carefully review and understand the terms of the confidentiality agreement before signing.