Sample Confidentiality Agreement
CONFIDENTIALITY AND NON-COMPETITION AGREEMENT
(For use by Franchisee with Employees, consultants and investors)
This Agreement is entered into on ________________________, 20___ by and between
______________________________________________________ ("Store Owner") and
A. Store Owner and The Coffee Beanery, Ltd. ("CBL") are parties to a Franchise Agreement dated____________________("Franchise Agreement").
B. Pursuant to the Franchise Agreement, Store Owner receives certain confidential information from CBL concerning the CBL system, and has agreed to certain covenants restricting in-term and post-term non-competition with CBL.
C. Store Owner has represented to CBL that, at CBL's request, Store Owner will secure from certain persons associated with Store Owner confidentiality and non-competition covenants similar to those provided by Store Owner to CBL under the Franchise Agreement.
D. Individual is among those persons from whom Store Owner has agreed to secure confidentiality and non-competition covenants, and Individual, by virtue of his/her association with Store Owner, is willing to execute an agreement providing such covenants.
NOW THEREFORE, in consideration of his/her association with Store Owner and One Dollar ($1.00), receipt of which is hereby acknowledged, Individual agrees that:
1. Individual shall not, during the term of his/her association with Store Owner or thereafter, communicate, divulge, or use for the benefit of anyone else, any confidential information, knowledge, or know-how concerning the methods of operation of either CBL's or Store Owner's business which may be communicated to Individual, or which Individual may learn during his/her employment by Store Owner. Individual agrees that any CBL or Store Owner manuals, and any and all matters, information, knowledge, know-how, and techniques which CBL or Store Owner designates as confidential, shall be deemed confidential for purposes of this Agreement.
2. Individual shall not, except as otherwise approved in writing by CBL, either directly or indirectly, for him/herself, or through, on behalf of, or in conjunction with, any person, persons, or legal entity:
a. During the period that Individual is associated with Store Owner and while the
Franchise Agreement is in effect, (i) divert or attempt to divert any business or customer of Store Owner's CBL store to any competitor by inducement or otherwise, or do or perform any other act injurious or prejudicial to the goodwill associated with CBL's trademarks or either CBL's or Store Owner's business; or (ii) own, maintain, advise, operate, engage in, be employed by, make loans to, have any interest in or relationship or association with, a business which offers the same or similar products or services as those offered by CBL stores.
The Coffee Beanery, Ltd.
Uniform Franchise Offering Circular (v.2006)
Exhibit G - 1
b. For a continuous, uninterrupted one (1) year period commencing upon the earlier
of the date that (i) Individual's association with Store Owner terminates or (ii) Store Owner's post-term non-competition covenant under its Franchise Agreement with CBL terminates, either directly or indirectly, for him/herself, or through, on behalf of, or in conjunction with any person, persons, or legal entity, own, maintain, advise, operate, engage in, be employed by, make loans to, or have any interest in or relationship or association with a business which offers the same or similar products or services as those offered by CBL stores, and which are located in or within a ten mile radius of the Store Owner's business.
This Section 2 shall not apply to the ownership by Individual of less than five percent (5%) of the outstanding equity securities of any company registered under the Securities Act of 1933 or the Securities Exchange Act of 1934.
3. Individual's obligations set forth in Section 2 of this Agreement shall be subject to the following provisions:
a. If all or any portion of Section 2 is held unreasonable or unenforceable by a court or agency having valid jurisdiction in an unappealed final decision to which CBL is a party, Individual shall be bound by any lesser covenant subsumed within the terms of such covenant that imposes the maximum duty permitted by law, as if the resulting covenant were separately stated in and made a part of this Agreement.
b. CBL shall have the right, in its sole discretion, to reduce the scope of any covenant or any portion thereof set forth in Section 2 hereof, without Individual's consent, effective immediately upon receipt by Individual of written notice thereof; and Individual agrees that it shall comply forthwith with any covenant as so modified.
c. The existence of any claims which Individual may have against CBL or Store Owner shall not constitute a defense to the enforcement by CBL or Store Owner of the provisions of this Agreement.
4. Individual understands and acknowledges that any failure to comply with the requirements of this Agreement will result in irreparable injury to CBL and/or Store Owner for which no adequate remedy at law may be available, and Individual consents to the issuance of, and agrees to pay, all court costs and reasonable attorneys' fees incurred by CBL and/or Store Owner in obtaining, without the posting of any bond, an ex parte or other order for inj uncti ve or other legal and/or equitable relief with respect to the requirements of this Agreement.
5. Individual understands and agrees that CBL is a third party beneficiary to this Agreement, and will have a separate and independent right to enforce this Agreement against Individual, regardless of whether Store Owner joins in any such action.
IN WITNESS WHEREOF, this Agreement has been signed on____________________, 20___.
The Coffee Beaneiy, Ltd. Exhibit G - 2
Uniform Franchise Offering Circular (v.2006)