Is a Crave franchisee permitted to disclose confidential information at any time during the franchise agreement?
Crave Franchise · 2025 FDDAnswer from 2025 FDD Document
10.2 Confidential Information
- 10.2.1 Neither you nor the Principals shall, during the term of this Agreement or thereafter, communicate, divulge or use for the benefit of any other person, persons, partnership, association or corporation and, following the expiration or termination of this Agreement, they shall not use for their own benefit any confidential information, knowledge or know-how concerning the methods of operation of the Franchised Business which may be communicated to them or of which they may be apprised in connection with the operation of the Franchised Business under the terms of this Agreement. You and the Principals shall divulge such confidential information only to such of your employees as must have access to it in order to operate the Franchised Business. Any and all information, knowledge, know-how, techniques and any materials used in or related to the System which we provide to you in connection with this Agreement, including but not limited to the Manual, plans and specifications, marketing information and strategies and site evaluation, selection guidelines and techniques, recipes, and the terms of this Agreement, shall be deemed confidential for purposes of this Agreement. Neither you nor the Principals shall at any time, without our prior written consent, copy, duplicate, record or otherwise reproduce such materials or information, in whole or in part, nor otherwise make the same available to any unauthorized person. The covenants in this Section shall survive the expiration, termination or transfer of this Agreement or any interest herein and shall be perpetually binding upon you and the Principals.
- 10.2.2 You shall require and obtain the execution of covenants similar to those set forth in Section 10.2.1 from your General Manager and all other of your personnel who have received or will have access to confidential information. Such covenants shall be substantially in the form set forth in Attachment 4. If any Principal is a married individual and the Principal's spouse has not executed this Agreement, such Principal shall cause his or her spouse to personally execute and bind himself or herself to the terms of a Spouse Confidentiality and Non-Compete Agreement, in the form attached as Attachment 8.
Source: Item 23 — RECEIPTS (FDD pages 63–253)
What This Means (2025 FDD)
According to the 2025 Crave Franchise Disclosure Document, franchisees are generally prohibited from disclosing confidential information during and after the term of the franchise agreement. Section 10.2.1 explicitly states that neither the franchisee nor their principals shall communicate, divulge, or use confidential information for the benefit of any other person or entity during the agreement or after its termination. This restriction extends to using such information for their own benefit after the agreement ends.
The FDD defines confidential information broadly, including knowledge concerning the methods of operation of the franchised business, which may be communicated to them in connection with the operation of the franchised business. This encompasses the manual, plans, specifications, marketing information, strategies, site evaluation, selection guidelines, techniques, recipes, and the terms of the agreement itself. Franchisees are only allowed to share confidential information with employees who need access to it to operate the franchised business.
Furthermore, franchisees must ensure that their General Manager and other personnel who have access to confidential information also execute covenants similar to those in Section 10.2.1. If a principal is married, their spouse may also be required to sign a Spouse Confidentiality and Non-Compete Agreement. This comprehensive approach underscores the importance Crave places on protecting its confidential information and trade secrets, ensuring that franchisees and related parties are legally bound to maintain confidentiality both during and after the franchise relationship.