For a Buona franchise, who must guarantee the Franchisee's performance under the Franchise Agreement?
Buona Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee covenants that Franchisee and any of its shareholders, officers, directors, members, managers, partners and guarantors, either directly or indirectly, for itself or themselves or on behalf of, or in conjunction with, any other person or entity, regardless of the cause for termination shall not:
- (a) For a period of two (2) years following the expiration or termination of this Agreement, have any ownership interest in, maintain, operate, engage in, serve as a director, officer, manager, employee, consultant or representative of, grant a franchise to, advise, help, make loans to, lease property to, or have any interest in, directly or indirectly, a Competitive Business that is located within a radius of ten (10) miles of (i) the location specified in the Approved Site Location Addendum as described in Article I or (ii) the location of any other Buona Business, whether owned by Franchisor or any other Buona franchisee, in existence as of the date of expiration or termination of this Agreement.
This restriction will not apply to the ownership of less than 2% of the outstanding shares of a publicly-traded security.
Franchisee and its officers, directors, shareholders, managers, members, partners and guarantors expressly acknowledge that they possess skills and abilities of a general nature and have other opportunities for exploiting those skills.
As a result, adherence to this restriction will not deprive them of their personal goodwill or ability to earn a living.
- 14.4 Nondisclosure and Noncompetition Agreement*.* Franchisee must have its shareholders, officers, directors, members, managers, partners, guarantors, supervisory and principal employees, including managers and assistant managers (as a condition to their employment), anyone Franchisee may choose to send to training, and anyone who has access to the Manual or any of Franchisor's proprietary information or Confidential Information, execute Franchisor's standard Nondisclosure and Noncompetition Agreement (which is an exhibit to the Franchise Disclosure Document and as may be updated in the Manual) before performing any work at the Franchised Business or otherwise having access to Franchisor's proprietary information.
A copy of all the signed agreements shall be delivered to Franchisor within one (1) week of their execution.
Source: Item 23 — RECEIPTS (FDD pages 78–356)
What This Means (2025 FDD)
According to Buona's 2025 Franchise Disclosure Document, the franchisee and any of its shareholders, officers, directors, members, managers, partners and guarantors must adhere to certain covenants. These individuals and the franchisee are restricted from engaging in any competitive business within a 10-mile radius of the Buona location or any other Buona business for a period of two years following the expiration or termination of the Franchise Agreement. This restriction applies regardless of the cause for termination.
Buona also requires that the franchisee ensures its shareholders, officers, directors, members, managers, partners, guarantors, supervisory and principal employees, including managers and assistant managers, execute Buona's standard Nondisclosure and Noncompetition Agreement. This agreement must be signed as a condition of their employment, for anyone the franchisee sends to training, and anyone who has access to the Manual or any of Buona's proprietary or confidential information. The franchisee must provide copies of all signed agreements to Buona within one week of their execution.
These measures are in place to protect Buona's interests and maintain the integrity of its brand by preventing individuals with knowledge of its operations and access to its confidential information from directly competing with the franchise after their association ends. It is a common practice in franchising to have such non-compete and non-disclosure agreements to safeguard the franchisor's business model and proprietary information.