Under what circumstances can a Mrcool franchisee disclose Confidential Information to a third party?

According to Mrcool's 2025 Franchise Disclosure Document, a franchisee is generally prohibited from disclosing Confidential Information to third parties unless specifically authorized by Mrcool. Specifically, the Franchise Agreement states that the franchisee cannot disclose, divulge, provide access to, communicate, and/or permit the communication of Confidential Information to any third party not otherwise authorized by Mrcool. This restriction applies to the contents, data, and information contained in the Operations Manual as well.

This means that Mrcool franchisees must be extremely careful about who they share sensitive business information with. This includes not only obvious third parties like competitors, but also potentially vendors, consultants, or even family members who are not directly involved in the business. Franchisees need to ensure that their employees and agents also adhere to strict confidentiality standards, as the franchisee is responsible for their actions in this regard.

To ensure compliance, Mrcool franchisees should seek written authorization from Mrcool before disclosing any information that could be considered confidential. They should also implement internal policies and procedures to protect Confidential Information, such as limiting access to sensitive documents and requiring employees to sign confidentiality agreements. The FDD includes a sample confidentiality agreement that Mrcool may approve for use by the franchisee with their employees or contractors; however, Mrcool recommends the franchisee have the agreement reviewed and approved by an independent local attorney.

Failure to comply with these confidentiality obligations can have serious consequences for Mrcool franchisees, potentially leading to termination of the franchise agreement and legal action by Mrcool. Therefore, it is crucial for prospective franchisees to fully understand and adhere to these restrictions.