Does the Buildingstars Guaranty cover trade secrets, non-solicitation, and non-competition provisions in the Franchise Agreement?
Buildingstars Franchise · 2025 FDDAnswer from 2025 FDD Document
or proceedings, or to otherwise protect and maintain the interest of BUILDINGSTARS or its Affiliates in the Marks.
- C. Change of Marks. BUILDINGSTARS shall have the right to change the Marks to be used by FRANCHISEE at any time and for any reason it deems appropriate. FRANCHISEE shall pay the costs associated with such change and shall make such necessary changes promptly.
IX. TRADE SECRETS AND CONFIDENTIAL INFORMATION
FRANCHISEE shall not, during the term of this Agreement, or after the Transfer, termination or expiration, communicate or divulge to anyone, any information or knowledge concerning the products, services, standards, procedures, techniques, sales information, profit margins, marketing procedures, expansion plans, Customers, rates, fees and terms, databases, or such other information that gives BUILDINGSTARS' Affiliate, BUILDINGSTARS and FRANCHISEE a competitive advantage over those who do not know it, and other information or material which BUILDINGSTARS may designate as confidential, nor shall FRANCHISEE disclose or divulge in whole or in part any trade secrets or operating procedures of BUILDINGSTARS or its Affiliates, Customer lists, Customer contracts, sales and promotional information, employee lists, supplier and vendor information, information regarding real property management companies or commercial real estate owners affiliated with or related to any Customer, customer account, or any commercial real estate for which BUILDINGSTARS, its Affiliates, FRANCHISEE or any other franchisee has provided commercial cleaning services; pricing information; financial information furnished or disclosed to FRANCHISEE by BUILDINGSTARS or its Affiliates and any other information with respect to BUILDINGSTARS, unless such information is generally known and in the public domain, and except to the extent necessary to operate the Business ("Confidential Information"). FRANCHISEE will exercise the highest degree of diligence and make every effort to maintain the absolute confidentiality of all trade secrets and proprietary rights during and after the term of this Agreement and will endeavor to insure that its employees will also comply.
X. NON-COMPETITION AND NON-SOLICITATION
A. Non-Competition. During the term of this Agreement and for a period of two (2) years after the expiration, Transfer or termination of this Agreement for any reason, FRANCHISEE will not directly or indirectly, by itself or through corporations, partnerships, trusts, associations, joint ventures, limited liability companies, or other entities or otherwise perform any services for, engage in or acquire, be an employee of, have any financial interest in, loan money to, or have any interest based on profits or revenues of, any cleaning service business or janitorial business within the Area or within any 10 mile
area where BUILDINGSTARS or any Affiliate, franchisee or licensee of BUILDINGSTARS is operating.
B. Non-Solicitation.
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- FRANCHISEE agrees that during the term of this Agreement and for one (1) year after the Transfer, expiration or termination for any reason of this Agreement or the entry of a final order of a court of competent jurisdiction enforcing this covenant, whichever is later, FRANCHISEE and any of its relatives, or associates, shall not, directly or indirectly, for FRANCHISEE or for any other person or entity (except BUILDINGSTARS):
- a. Provide or attempt to provide (or others of the opportunity to provide), directly or indirectly, any Services to any Customer for which FRANCHISEE has rendered services under this Agreement or to which FRANCHISEE has been introduced by or about which FRANCHISEE has received information by being a Buildingstars franchisee.
- b. In the event that there is a breach of this provision, Franchisee shall pay BUILDINGSTARS a fee equal to 3 times the monthly amount agreed to be paid by the Customer for the Services.
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- FRANCHISEE agrees that during the term of this Agreement and for one (1) year after the Transfer, expiration or termination for any reason of this Agreement or the entry of a final order of a court of competent jurisdiction enforcing this covenant, whichever is later, FRANCHISEE and any of its relatives, or associates, shall not, directly or indirectly, for FRANCHISEE or for any other person or entity (except BUILDINGSTARS):
- a. Contact, solicit, attempt to contact or solicit, or participate or aid with the contact or solicitation of or provide or attempt to provide (or advise others of the opportunity to provide directly or indirectly any cleaning or janitorial services to any Customer for any reason other than providing services pursuant to this Agreement, including but not limited to notifying any Customer of FRANCHISEE'S new affiliation or employment;
- b.
Source: Item 22 — CONTRACTS (FDD page 43)
What This Means (2025 FDD)
Based on the 2025 Buildingstars Franchise Disclosure Document, the franchise agreement includes provisions related to trade secrets, non-competition, and non-solicitation.
Regarding trade secrets and confidential information, the agreement states that franchisees cannot disclose any information about Buildingstars' products, services, standards, procedures, techniques, sales information, profit margins, marketing procedures, expansion plans, customers, rates, fees, databases, or other information that gives Buildingstars a competitive advantage. This obligation extends both during and after the term of the agreement. Franchisees must maintain the confidentiality of trade secrets and proprietary rights, ensuring their employees also comply.
The franchise agreement also includes non-competition and non-solicitation clauses. During the term of the agreement and for two years after its expiration, transfer, or termination, franchisees are prohibited from engaging in or having any financial interest in any cleaning service or janitorial business within their area or within a 10-mile radius of any Buildingstars location. Additionally, for one year after the agreement's termination, franchisees are restricted from providing services to or soliciting Buildingstars' customers or service providers.
The Buildingstars FDD does not specify whether the Buildingstars Guaranty covers these specific provisions. A prospective franchisee should seek clarification from the franchisor regarding the extent to which the Guaranty applies to the trade secret, non-solicitation, and non-competition obligations outlined in the franchise agreement.