What restrictions on confidential information must Crave franchisees and principals comply with, as outlined in 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.
10.2.3 New Concepts. If Franchisee or any Principal develops any new concept, process, recipe, product, service, or improvement in the operation or promotion of the Franchised Business ("Improvements"), Franchisee is required to promptly notify Franchisor and provide Franchisor with all related information, processes, products or other improvements, and sign any and all forms, documents and/or papers necessary for Franchisor to obtain full proprietary rights to such Improvements, without compensation and without any claim of ownership or proprietary rights to such Improvements. Franchisee and any Principal acknowledge that any such Improvements will become the property of Franchisor, and Franchisor may use or disclose such information to other franchisees as it determines to be appropriate.
Source: Item 23 — RECEIPTS (FDD pages 63–253)
What This Means (2025 FDD)
According to Crave's 2025 Franchise Disclosure Document, franchisees and their principals are bound by strict confidentiality obligations, both during the term of the Franchise Agreement and after its termination or expiration. Franchisees and principals cannot communicate, divulge, or use any confidential information about the operational methods of the franchised business for the benefit of any other entity or for their own benefit after the agreement ends. They can only share confidential information with employees who need it to operate the franchise.
Confidential information includes, but isn't limited to, the operations manual, plans, specifications, marketing strategies, site evaluation guidelines, recipes, and the terms of the Franchise Agreement itself. Franchisees and principals are prohibited from copying, duplicating, recording, or reproducing these materials without Crave's prior written consent, and they cannot make them available to unauthorized individuals. These confidentiality obligations remain in effect even after the agreement expires, terminates, or is transferred.
Crave requires franchisees to ensure that their general manager and any personnel with access to confidential information sign confidentiality agreements similar to those required of the franchisee and principals. Furthermore, if a principal is married and their spouse has not signed the Franchise Agreement, the principal must ensure that their spouse signs a Spouse Confidentiality and Non-Compete Agreement. This ensures that all parties with potential access to sensitive information are legally bound to protect it. If a franchisee or principal develops any improvements to the Crave system, they must promptly notify Crave and transfer all rights to those improvements to Crave without compensation.