What precautions must each party take to preserve the secrecy of confidential information disclosed by the other party under the Budget franchise agreement?
Budget Franchise · 2025 FDDAnswer from 2025 FDD Document
8. Proprietary Information.
- (a) Each party agrees to take all reasonable precautions (i) to preserve the secrecy of all information of a confidential nature disclosed to it by the other party that is clearly designated or described as confidential, (ii) to keep such information secure and protected against unauthorized access and (iii) to ensure that these obligations are observed by its employees, officers, agents and contractors. Such obligations will survive termination of this Agreement.
- (b) Neither party will be liable for disclosure to others of any such information or data if the same or similar information or data (i) was in the public domain at the time it was disclosed to others; (ii) was known and can be shown to have been known to the party receiving it at the time it was received; (iii) is disclosed inadvertently despite the exercise of the same measure of care as the disclosing party takes to preserve or safeguard its own proprietary or confidential information or data, but in no event less than ordinary care; or (iv) is disclosed to others with the prior written consent of the other party.
- (c) Notwithstanding any other provision of this Agreement, Wizard, including all systems, software, methodology, and documentation thereof and all copyrights and other proprietary rights thereof or therein and the name "Wizard System" are owned by ABCR, and Licensee will use its best efforts to maintain all information relating to the System, such methodology and documentation in strict confidence by Licensee and its employees and agents, notwithstanding any completion or termination of this Agreement. Nothing herein will preclude or prevent Licensee from using such information as is necessary to conduct its business so as fully to realize the benefits of the System, or from disclosing such information in good faith to the extent necessary to obtain assistance from third parties that are engaged by Licensee or ABCR to assist Licensee in acquiring, using, maintaining or repairing Licensee's Equipment and that are advised of the proprietary and confidential nature of such information and have signed a non-disclosure agreement with respect thereto.
Source: Item 23 — RECEIPTS (FDD pages 80–426)
What This Means (2025 FDD)
According to Budget's 2025 Franchise Disclosure Document, both parties must take reasonable precautions to protect confidential information. This includes preserving the secrecy of information clearly designated as confidential, securing it against unauthorized access, and ensuring that employees, officers, agents, and contractors also adhere to these obligations. These responsibilities continue even after the termination of the agreement.
However, neither party is held liable for disclosing information if it was already public knowledge, known to the receiving party at the time of receipt, disclosed inadvertently despite ordinary care to safeguard it, or disclosed with the other party's prior written consent.
Budget also stipulates that the Wizard system, including its software, methodology, documentation, copyrights, and the name "Wizard System," remains the property of ABCR. Licensees must use their best efforts to keep all information about the system strictly confidential, even after the agreement ends. Licensees can still use the information as needed to conduct their business and get help from third parties who are also bound by non-disclosure agreements.