Does the obligation to preserve the secrecy of confidential information disclosed by either party in the Budget franchise agreement survive the termination of the agreement?

According to Budget's 2025 Franchise Disclosure Document, the obligation to preserve the secrecy of confidential information disclosed by either party does indeed survive the termination of the franchise agreement. Specifically, each party agrees to take reasonable precautions to preserve the secrecy of confidential information disclosed by the other party, ensure the information is protected against unauthorized access, and ensure that these obligations are observed by its employees, officers, agents, and contractors.

This survival clause means that even after the franchise agreement ends, whether through termination or expiration, both Budget and the franchisee remain legally bound to protect the other's confidential information. This includes trade secrets, business strategies, and other proprietary data. This provision aims to protect the long-term interests of both parties by preventing the misuse of sensitive information after the business relationship concludes.

This is a fairly standard practice in franchising, as franchisors share a great deal of confidential information with their franchisees during the term of the agreement. The survival of confidentiality obligations ensures that franchisees cannot use this information to compete with the franchisor after the agreement ends, or disclose it to third parties. Similarly, it protects the franchisee from the franchisor misusing any confidential information the franchisee may have shared with them.