Does the confidentiality requirement for Spray Net's trade secrets and confidential information continue after the termination or expiration and non-renewal of the agreement?
Spray_Net Franchise · 2025 FDDAnswer from 2025 FDD Document
btedness of Franchisee arising under or by virtue of the aforesaid Franchise Agreement; (ii) the prohibition of any change in the percentage of Franchisee owned, directly or indirectly, by any person, without first obtaining the written consent of Franchisor prior to said proposed transfer as set forth in the Franchise Agreement; (iii) those obligations related to confidentiality, non-disclosure and indemnification; and (iv) the in-term and post-term covenants against competition, as well as all other restrictive covenants set forth in the Franchise Agreement.
ARTICLE II CONFIDENTIALITY
During the initial and any renewal terms of the Franchise Agreement and this Guaranty, you will receive information, which Franchisor considers to be Confidential Information, trade secrets and/or confidential information, including without limitation: (i) site-selection criteria; (ii) methods, techniques and trade secrets for use in connection with the proprietary business operating system that Franchisor and its affiliates have developed (the "System")forthe establishment and operation of a SPRAY-NET business(each, an "Franchised Business") and/or franchise (each, a "Franchised Business"); (iii) marketing research and promotional, marketing and advertising programs for the Franchised Business; (iv) knowledge of specification for and suppliers of, certain products, fixtures, furnishings, equipment and inventory used at the Franchised Business (v) knowledge of the operating results and financial performance of other Franchised Businesses; (vi) customer communication and retention programs, along with data used or generated in connection with those programs; (vii) Franchisor's proprietary Manuals and other instructional manuals, as well as any training materials and information Franchisor has developed for use in connection with the System;
Source: Item 23 — RECEIPTS (FDD pages 75–219)
What This Means (2025 FDD)
According to Spray Net's 2025 Franchise Disclosure Document, franchisees receive confidential information and trade secrets during the franchise term. This includes site-selection criteria, methods, techniques, marketing research, knowledge of suppliers, operating results, customer communication programs, proprietary manuals, information regarding proprietary marks, and information generated by the franchised business.
Spray Net requires franchisees to keep this information confidential during the initial and any renewal terms of the Franchise Agreement and this Guaranty. The FDD states that upon expiration or termination of the agreement, all electronic or hard copies of the manuals must be immediately returned and never used for any competitive purpose.
While the excerpt specifies the types of information considered confidential and the requirement to return manuals, it does not explicitly state whether the confidentiality obligations extend beyond the termination or expiration of the franchise agreement. A prospective franchisee should clarify with Spray Net whether the confidentiality requirement for trade secrets and confidential information continues after the termination or expiration and non-renewal of the agreement.