What are the Crave franchisee's obligations regarding confidential information after the expiration or termination of the Franchise Agreement?
Crave Franchise · 2025 FDDAnswer from 2025 FDD Document
- 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 Crave's 2025 Franchise Disclosure Document, both the franchisee and their principals have ongoing obligations regarding confidential information, even after the franchise agreement expires or terminates. They are prohibited from communicating, divulging, or using any confidential information, knowledge, or know-how related to the operation of the franchised business for the benefit of any other person or entity. Furthermore, they cannot use this confidential information for their own benefit after the agreement ends. This includes information about the methods of operation of the Crave business that they learned while operating under the franchise agreement.
The FDD specifies that confidential information includes the manual, plans and specifications, marketing information and strategies, site evaluation and selection guidelines, techniques, recipes, and the terms of the agreement itself. Franchisees and their principals are not allowed to copy, duplicate, record, or reproduce these materials or information without Crave's prior written consent, nor can they make them available to any unauthorized person. These restrictions are perpetually binding, meaning they continue indefinitely even after the franchise agreement is no longer in effect.
Crave also requires franchisees to obtain similar confidentiality covenants from their General Manager and other personnel who have access to confidential information, using a form substantially similar to Attachment 4 in the FDD. If a principal is married and their spouse has not signed the agreement, the principal must ensure that their spouse signs a Spouse Confidentiality and Non-Compete Agreement, using the form attached as Attachment 8. This ensures that confidential information is protected at all levels and within the franchisee's household.