According to the Itan FDD, what is the purpose of the 'Confidentiality Agreement'?
Itan Franchise · 2025 FDDAnswer from 2025 FDD Document
ch section of this Agreement (and portion thereof) is severable. If any section (or portion thereof) is unenforceable, it shall not affect the enforceability of any other section (or portion thereof). A court may revise any provision of this Agreement to the extent necessary to make the provision enforceable.
This Brand Protection Agreement is executed as of the date or dates set forth below.
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ATTACHMENT "G"
TO FRANCHISE AGREEMENT
CONFIDENTIALITY AGREEMENT
[See Attached]
CONFIDENTIALITY AGREEMENT
This Agreement (this "Agreement") is entered into by the undersigned ("you") in favor of iTAN Franchising, Inc., a California corporation and its successors and assigns ("us").
- 1. DEFINITIONS. Capitalized terms that are not defined above have the meanings given to them below:
- "Business Data" means all data pertaining to Franchisee's Salon, customers and business operations, whether collected by you, Franchisee, us or any other person.
- "Confidential Information" means and includes: (a) Know-How; (b) Business Data; (c) information in the Manual or comprising the System; (d) terms of the Franchise Agreement (and related agreements) signed by Franchisee in connection with the Salon; and (e) all other concepts, ideas, trade secrets, financial information, marketing strategies, expansion strategies, studies, supplier information, customer information, franchisee information, investor information, flow charts, inventions, mask works, improvements, discoveries, standards, specifications, formulae, recipes, designs, sketches, drawings, policies, processes, procedures, methodologies and techniques, together with analyses, compilations, studies or other documents that are: (i) designated as confidential; (ii) known by you to be considered confidential by us; and/or (iii) reasonably to be considered confidential due to their nature. Confidential Information does not include information that: (a) is now, or subsequently becomes, generally available to the public (except as a result of a breach of confidentiality obligations by you, Franchisee or Franchisee's owners, employees or other constituents); (b) you can demonstrate was rightfully in your possession, without obligation of nondisclosure, before we (or any person associated with us) or Franchisee (or any person associated with Franchisee) disclosed the information to you; (c) is independently developed by you without any use of, or reference to, any Confidential Information; or (d) is rightfully obtained from a third party who has the right to transfer or disclose the information to you without breaching a confidentiality covenant imposed on such third party.
- "Copyrighted Materials" means all copyrightable materials for which we or our affiliate claim or secure common law or registered copyright protection and that we allow franchisees to use, sell or display in connection with the marketing and/or operation of a Salon.
- "Franchisee" means the iTAN franchisee for whom you are an employee or independent contractor.
- "Improvement" means any idea, addition, modification or improvement to the (a) goods or services offered or sold at a Salon, (b) method of operation of a Salon, (c) processes, systems or procedures utilized by a Salon, (d) marketing, advertising or promotional materials, programs or strategies utilized by a Salon or (e) trademarks, service marks, logos or other intellectual property utilized by a Salon, whether developed by you, Franchisee, us or any other person.
- "Intellectual Property" means, collectively or individually, the Business Data, Copyrighted Materials, Improvements, Know-how, Marks and System.
Source: Item 23 — RECEIPT (FDD pages 44–190)
What This Means (2025 FDD)
According to Itan's 2025 Franchise Disclosure Document, the Confidentiality Agreement is designed to protect Itan's intellectual property and confidential information. The agreement is entered into by individuals associated with an Itan franchisee, such as employees or independent contractors, to prevent misuse of the franchisor's proprietary assets. By signing this agreement, individuals acknowledge that they may gain knowledge of Itan's System and Know-how, and they agree to protect this information. The agreement aims to safeguard the franchise system from potential damage that could arise from the misuse of Itan's intellectual property.
The Confidentiality Agreement outlines specific obligations, including refraining from using intellectual property or confidential information for any purpose other than the operation of the franchisee's salon for the exclusive benefit of the franchisee. It also requires maintaining the confidentiality of confidential information at all times, preventing unauthorized copies of documents containing such information, and taking steps to prevent unauthorized use or disclosure. Upon termination of employment or the independent contractor relationship, the individual must immediately cease using Itan's intellectual property and confidential information.
Furthermore, the agreement includes provisions for assigning rights to any improvements developed by the individual to Itan or its designee. It also addresses unfair competition, restricting individuals from engaging in prohibited activities during their association with the franchisee and for a specified period thereafter, within a defined territory. These measures collectively aim to protect Itan's brand, trade secrets, and competitive advantage within the market.
For a prospective Itan franchisee, this underscores the importance of ensuring that all employees and independent contractors understand and adhere to the terms of the Confidentiality Agreement. Franchisees must implement measures to safeguard confidential information and intellectual property, as any breach could have significant repercussions for the entire Itan franchise system. The agreement also highlights the ongoing obligations and restrictions that extend beyond the period of employment or contract, emphasizing the long-term commitment to protecting Itan's proprietary assets.