Who is identified as a third-party beneficiary in the confidentiality agreement that Fitstop requires?
Fitstop Franchise · 2024 FDDAnswer from 2024 FDD Document
You must require your Designated Manager and any personnel having access to any of our Confidential Information to sign our then-current form of Confidentiality and Non-Competition Agreement set forth in our then-current Manuals or form of franchise agreement, where these individuals agree that they will maintain the confidentiality of information they receive in connection with their employment and restrict their right to work for a competitor while they are employed by you. This confidentiality agreement, which will be in a form that we prescribe, will identify us as a third-party beneficiary to the agreement and will give us independent enforcement rights.
Source: Item 14 — PATENTS, COPYRIGHTS, AND PROPRIETARY INFORMATION (FDD pages 38–40)
What This Means (2024 FDD)
According to Fitstop's 2024 Franchise Disclosure Document, Fitstop requires its franchisees to have their Designated Manager and any personnel with access to confidential information sign a Confidentiality and Non-Competition Agreement. This agreement ensures the confidentiality of information received during their employment and restricts their ability to work for a competitor while employed by the franchisee.
Fitstop is identified as a third-party beneficiary in this agreement. This means that Fitstop has independent rights to enforce the confidentiality agreement, even though they are not a direct party to the agreement between the franchisee and their employee.
This provision is designed to protect Fitstop's confidential information and trade secrets. By being named as a third-party beneficiary, Fitstop can directly take legal action against an employee who breaches the confidentiality agreement, without having to rely on the franchisee to do so. This provides Fitstop with an additional layer of protection for its proprietary information and ensures that its trade secrets are not disclosed or used by unauthorized parties.