What is a prohibited action regarding Ledgers' Confidential Information?

According to Ledgers' 2025 Franchise Disclosure Document, franchisees are prohibited from directly or indirectly disclosing, publishing, or sharing any Confidential Information with any third party without Ledgers' prior written consent. However, a franchisee may share Confidential Information with their employees or agents if those individuals need the information to perform essential job functions and are subject to equivalent confidentiality restrictions.

Ledgers defines "Confidential Information" as non-public, sensitive, or proprietary material related to their Franchise System, the relationship with the franchisee, or the Franchise Business, whether provided by Ledgers or the franchisee. This information can be oral or written in any form, including tangible, intangible, and electronic media, regardless of whether it is marked as confidential. Confidential Information includes client lists, performance data, and reports from the Franchise System, along with any notes, summaries, or other derivative works.

Furthermore, franchisees can only use Confidential Information to fulfill their obligations under the Franchise Agreement. They must not use Confidential Information for their own benefit or to Ledgers' detriment. Specifically, Confidential Information cannot be used in a competing business that is detrimental to Ledgers. This ensures that franchisees do not exploit sensitive information gained from the franchise relationship to create or support a competing venture.

These restrictions are typical in franchising to protect the franchisor's proprietary information and maintain a competitive advantage. Prospective Ledgers franchisees should understand these confidentiality obligations and ensure they have adequate measures in place to protect Confidential Information, including training employees and securing data storage.