What must a Chatime developer do to prevent unauthorized use or disclosure of Confidential Information?
Chatime Franchise · 2025 FDDAnswer from 2025 FDD Document
prior and superior right to registration of any such domain names. If a domain name or Internet address is to be used in Developer's Operation, it must be registered in the name of Franchisor or any other nominee of Franchisor. However, all fees must be paid by Developer.
- (3) Franchisor may, but is not obliged to, designate one or more web pages to describe Developer and/or the Outlets, such web pages to be located within Franchisor's Website.
- (4) If Developer becomes aware of any Person using or referring to the Marks on their Website, then it must immediately notify Franchisor.
6 Confidential Information
- 6.1 Obligation to Maintain Confidentiality
- (1) Developer and Guarantor acknowledge and agree that neither Developer nor any Guarantor will acquire any interest in the Confidential Information, other than the right to utilize the Confidential Information in performing their obligations under this Agreement, and that the use or duplication of any Confidential Information would constitute an unfair method of competition.
- (2) Developer and Guarantor hereby agree that during the term of this Agreement and following the expiration or termination of this Agreement that they:
- (a) Will not use the Confidential Information in any other business operation or capacity;
- (b) Will maintain the absolute confidentiality of the Confidential Information;
- (c) Will not make unauthorized copies of any portion of the Confidential Information;
Source: Item 23 — Receipts (FDD pages 58–262)
What This Means (2025 FDD)
According to Chatime's 2025 Franchise Disclosure Document, a developer must adopt and implement all reasonable procedures that Chatime prescribes to prevent unauthorized use or disclosure of confidential information. These procedures include restrictions on disclosing confidential information to franchisees, outlet personnel, and others.
Chatime developers and guarantors acknowledge that they will not acquire any interest in the confidential information, other than the right to utilize it in performing their obligations under the agreement. They agree not to use the confidential information in any other business operation or capacity and to maintain its absolute confidentiality. They also agree not to make unauthorized copies of any portion of the confidential information.
If required by Chatime, the developer must ensure that their owner managers, directors, shareholders, agents, employees, and any interested party enter into a confidentiality agreement in a form acceptable to Chatime. This ensures that all parties with access to confidential information are legally bound to protect it.
These measures are typical in franchising to protect the brand's proprietary information and maintain a competitive advantage. A prospective Chatime developer should carefully review the specific procedures and restrictions outlined by Chatime to ensure they can comply with these obligations.