What is the Exit franchisee's responsibility to protect Confidential Information that is not considered a Trade Secret?
Exit Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee agrees that, during the term of this Agreement and all renewals and extensions of this Agreement, and after termination, expiration, or non-renewal of this Agreement, Franchisee shall hold all Confidential Information that is not a Trade Secret in strictest confidence, shall not use or disclose such Confidential Information (except in the performance of this Agreement), shall diligently protect any and all Confidential Information against loss by inadvertent or unauthorized disclosure, and shall comply with guidelines established by EXIT and Subfranchisor for the purpose of protecting the information.
Source: Item 23 — RECEIPT (FDD pages 42–235)
What This Means (2025 FDD)
According to Exit's 2025 Franchise Disclosure Document, franchisees have specific obligations regarding Confidential Information that does not qualify as a Trade Secret. During the term of the Franchise Agreement, including any renewals or extensions, and even after termination, expiration, or non-renewal, the franchisee must hold all Confidential Information that is not a Trade Secret in the strictest confidence. This means they cannot use or disclose this information, except when it's necessary for performing their duties under the Franchise Agreement.
Furthermore, Exit franchisees are required to diligently protect all Confidential Information against loss through inadvertent or unauthorized disclosure. They must also adhere to any guidelines established by Exit and its subfranchisor aimed at safeguarding this information. This obligation ensures that sensitive business data and operational methods remain protected, preventing potential competitive disadvantages.
This requirement is crucial for maintaining the integrity and competitive edge of the Exit franchise system. By mandating strict confidentiality and protection measures, Exit aims to prevent the leakage of valuable information that could be exploited by competitors or otherwise harm the franchise network. Franchisees should be aware of these responsibilities and implement appropriate safeguards to comply with these requirements.