Under what circumstances are the restrictions on using Confidential Information waived for a Chatime developer?
Chatime Franchise · 2025 FDDAnswer from 2025 FDD Document
- (3) Notwithstanding anything to the contrary contained in this Agreement, the restrictions set out in clause 6.1(2) will not apply to information that:
- (a) Is or becomes publicly available, other than by breach of this Agreement;
- (b) Developer or Guarantor (as applicable) is legally compelled to disclose, provided Developer/Guarantor must have used its best efforts and afforded Franchisor the opportunity to obtain an appropriate protective order or other assurance
satisfactory to Franchisor of confidential treatment for the information required to be disclosed; or
- (c) Is otherwise permitted under the terms of this Agreement.
Source: Item 23 — Receipts (FDD pages 58–262)
What This Means (2025 FDD)
According to Chatime's 2025 Franchise Disclosure Document, there are specific circumstances under which the restrictions on using confidential information do not apply to a developer. These exceptions are designed to balance the protection of Chatime's proprietary information with the developer's need to operate their business effectively and comply with legal requirements.
The restrictions on using confidential information are waived if the information is or becomes publicly available, provided that the information did not become public due to a breach of the agreement by the developer. This acknowledges that information already in the public domain cannot reasonably be kept secret.
Additionally, the restrictions do not apply if the developer is legally compelled to disclose the confidential information. However, the developer must first use their best efforts to obtain a protective order or other assurance from the relevant authority that the information will be treated confidentially. The restrictions are also waived if the use of confidential information is otherwise permitted under the terms of the agreement.