Is it prohibited to share the Exit FDD receipt acknowledgement with unauthorized parties?
Exit Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee acknowledges that it has or will acquire knowledge of confidential matters, Trade Secrets (as defined by applicable state law, as the same may be subsequently amended), recruiting techniques, operational, accounting and quality control procedures, and other methods developed by EXIT through and in its System and that the unique and novel combination of "know how" and methods developed by EXIT and licensed to Franchisee by Subfranchisor, for the real estate service operation, are peculiar to EXIT ("Confidential Information"), which, for purposes of this Agreement, are owned by EXIT, and which are necessary and essential to the operation of the Franchise. Confidential Information shall not apply to information that Franchisee can document (a) is or becomes generally available to the public (through no improper action or inaction by Franchisee); (b) was in Franchisee's possession or known by Franchisee without any limitation on user or disclosure prior to receipt from Franchisor or Subfranchisor; (c) was rightfully disclosed to Franchisee by a third party without restrictions; or (d) as required by court order.
Franchisee agrees that Franchisee shall hold all Trade Secrets in strictest confidence, shall not use or disclose Trade Secrets at any time (except in the performance of this Agreement) until such time as the information ceases to be a Trade Secret through no fault of Franchisee, shall diligently protect any and all Trade Secrets against loss by inadvertent or unauthorized disclosure, and shall comply with guidelines established by Company for the purpose of protecting such information.
Source: Item 23 — RECEIPT (FDD pages 42–235)
What This Means (2025 FDD)
Based on the 2025 Exit Franchise Disclosure Document, there is no explicit mention of prohibitions against sharing the FDD receipt acknowledgment with unauthorized parties. However, the FDD does emphasize the importance of maintaining the confidentiality of information related to Exit's trade secrets, systems, and confidential information.
Specifically, the agreement states that franchisees acknowledge they will acquire knowledge of confidential matters, trade secrets, recruiting techniques, operational, accounting, and quality control procedures, and other methods developed by Exit through its system. Franchisees must hold all trade secrets in strictest confidence and protect them against unauthorized disclosure. This suggests that while the receipt acknowledgment itself isn't explicitly mentioned, the broader principle of maintaining confidentiality could apply.
Given the emphasis on protecting Exit's confidential information and trade secrets, a prospective franchisee should clarify with Exit what specific documents or information are considered confidential and whether the FDD receipt acknowledgment falls under that umbrella. Understanding these obligations is crucial to avoid potential breaches of contract and to maintain a positive relationship with Exit.