Under what circumstances can a Caring Transitions franchisee divulge confidential information to its employees, agents, or professional advisors?
Caring_Transitions Franchise · 2025 FDDAnswer from 2025 FDD Document
10.1 Use of Confidential Information. Franchisee shall not, during the term of this agreement or thereafter, communicate, divulge, or use for the benefit of any other person, persons, partnership, association or corporation, any confidential information, knowledge, or know-how concerning the franchised business, the system, or methods of operation that may be communicated to Franchisee, or of which Franchisee may be apprised, by virtue of Franchisee's business operations under the terms of this agreement ("confidential information"). "Confidential information" includes the identities and personal and contact information of clients of the franchised business, financial statements, results of operations, sales, income, expense, and other financial information and records of the franchised business, and all electronic information, lists and data related to past, present and future clients of any franchise, including any franchise operated by Franchisee. Franchisee shall divulge confidential information only to such of its employees, agents, or professional advisors as must have access to it in order to operate the franchised business as described herein, or with Franchisor's prior written consent. In connection therewith, Franchisee shall be fully responsible for ensuring that its employees, agents, and professional advisors comply with this section.
10.2 Remedies. Franchisee acknowledges that any failure to comply with Section 10.1 will cause Franchisor irreparable injury, and Franchisee consents to the issuance of, and agrees to pay all court costs and reasonable attorneys' fees incurred by Franchisor in obtaining, specific performance of, or any injunction against a violation of, the requirements of Section 10.1.
10.3 Preservation of Confidentiality.
Franchisee shall require Franchisee's Principals, directors, officers, and management employees, at the time of the commencement of their association with Franchisee, to execute confidentiality agreements, in a form approved by Franchisor, requiring that all confidential information that may be acquired by or imparted to such persons in connection with their association with Franchisee be held in strict confidence and used solely for the benefit of Franchisee and Franchisor, at all times during their association with Franchisee and thereafter.
Source: Item 20 — OUTLETS AND FRANCHISEE INFORMATION (FDD pages 41–49)
What This Means (2025 FDD)
According to Caring Transitions' 2025 Franchise Disclosure Document, a franchisee is restricted from sharing confidential information about the franchised business, system, or operational methods. This restriction applies both during and after the franchise agreement term. Confidential information includes client identities and contact details, financial statements, operational results, sales data, income, expenses, and electronic data related to past, present, and future clients.
A Caring Transitions franchisee can only share confidential information with employees, agents, or professional advisors who require access to it for the purpose of operating the franchised business as outlined in the franchise agreement. Any other disclosure requires the prior written consent of Caring Transitions. The franchisee is responsible for ensuring that these employees, agents, and advisors maintain confidentiality.
To further ensure confidentiality, Caring Transitions requires franchisees to have their principals, directors, officers, and management employees sign confidentiality agreements. These agreements must be in a form approved by Caring Transitions, mandating that all confidential information acquired during their association with the franchisee is kept strictly confidential and used solely for the benefit of both the franchisee and Caring Transitions. This obligation extends throughout their association and even after its termination. Failure to comply with these confidentiality requirements can result in legal action, with the franchisee liable for court costs and attorney's fees incurred by Caring Transitions in enforcing these provisions.