What is the Hck Hot Chicken franchisee's responsibility to maintain the confidentiality of Trade Secrets during the term of the franchise agreement?
Hck_Hot_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
Each Restricted Person shall: (i) not use the Trade Secrets in any business or other endeavor other than in connection with the Franchised Restaurant; (ii) maintain absolute confidentiality of the Trade Secrets during and after the Term of this Agreement; and (iii) make no unauthorized copy of any portion of the Trade Secrets, including the HCK Hot Chicken Brand Standards Manual, bulletins, supplements, confidential correspondence, or other confidential communications, whether written or oral.
Franchisee shall operate the Restaurant and implement all reasonable procedures prescribed from time to time by Franchisor to prevent unauthorized use and disclosure of the Trade Secrets, including, implementing restrictions and limitations as Franchisor may prescribe on disclosure to employees and use of non-disclosure and noncompetition provisions in employment agreements with employees who may have access to the Trade Secrets.
Promptly upon Franchisor's request, Franchisee shall deliver executed copies of such agreements to Franchisor.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 54)
What This Means (2025 FDD)
According to the 2025 Hck Hot Chicken Franchise Disclosure Document, franchisees and their 'Restricted Persons' (employees, etc.) have strict obligations regarding the brand's Trade Secrets. Hck Hot Chicken may disclose Trade Secrets through various channels, including the HCK Hot Chicken Brand Standards Manual, training programs, and other communications. Franchisees don't gain any ownership of these Trade Secrets, only the right to use them while operating their Hck Hot Chicken franchise. Any unauthorized use or duplication of these secrets is considered unfair competition.
During the term of the franchise agreement, franchisees must maintain absolute confidentiality of the Trade Secrets. This means they can only use the information to operate their Hck Hot Chicken restaurant and cannot disclose it to any outside parties. Franchisees must also prevent unauthorized use or disclosure by implementing reasonable procedures, including employee restrictions and non-disclosure agreements. Franchisees must provide copies of these agreements to Hck Hot Chicken upon request.
Even after the franchise agreement ends, the franchisee's duty to protect Hck Hot Chicken's Trade Secrets continues. Upon termination or expiration of the agreement, franchisees must immediately cease using all Trade Secrets and return the HCK Hot Chicken Brand Standards Manual and all materials containing Trade Secrets to Hck Hot Chicken. Failure to comply with these confidentiality obligations can be considered a material breach of the franchise agreement.