What is Buona franchisee's obligation regarding the use of Confidential Information after the termination of the franchise agreement?
Buona Franchise · 2025 FDDAnswer from 2025 FDD Document
mation and know-how relating to the methods of developing, operating and marketing the Franchised Business and the System. Further, Confidential Information shall include all customer information, lists, data and records of the Franchised Business. Confidential Information does not include information Franchisee can demonstrate came to Franchisee's attention through legal methods other than by disclosure by Franchisor, or which, at the time of disclosure thereof by Franchisor to Franchisee, had become a part of the public domain, through publication or communication by others; or which, after disclosure to Franchisee by Franchisor, becomes a part of the public domain, through publication or communication by others.
- 13.2 Maintenance of Confidential Information. During the Term, and after the expiration or termination of this Agreement, Franchisee must use its best efforts to protect the Confidential Information. Accordingly, Franchisee must not communicate, divulge, or use for the benefit of any other person, persons or entity, any part of the Confidential Information. Franchisee may divulge such Confidential Information only to such employees of Franchisee who must have access to it in order to carry out Franchisee's obligations under this Agreement, and as may be required by law, provided Franchisee shall give Franchisor prior written notice of any such required disclosure by law immediately upon receipt of notice by Franchisee in order for Franchisor to have the opportunity to seek a protective order or take such other actions as it deems appropriate under the circumstances. Franchisor reserves the right to require Franchisee, or any of its owners, officers, partners, principals, managers, and employees having access to the Confidential Information to execute a confidentiality agreement or similar instrument(s) containing restrictions as those provided in this Section and, as applicable, throughout this Agreement. Such requirement shall not create an employee or joint employee relationship between Franchisor and Franchisee's employees, nor does it constitute control by Franchisor over Franchisee's employment matters.
XIV. COVENANTS
- 14.1 Franchisee's Best Efforts. Franchisee covenants that, during the Term, except as otherwise approved in writing by Franchisor, Franchisee or, alternatively, one designated management employee or approved agent if that employee or agent assumes primary responsibility for the operation of the Franchised Business, shall devote full time energy and best efforts to the development and promotion of the Franchised Business and to the management and operation of the Franchised Business.
- 14.2 Non-Competition and Non-Solicitation During Term.
Source: Item 23 — RECEIPTS (FDD pages 78–356)
What This Means (2025 FDD)
According to Buona's 2025 Franchise Disclosure Document, franchisees have specific obligations regarding confidential information both during and after the franchise agreement. Buona defines "Confidential Information" as data related to the company or its system that isn't public knowledge. This includes the manual, operational standards, recipes, marketing materials, customer data, and methods for operating and marketing the franchised business.
After the franchise agreement expires or terminates, the franchisee must continue to protect this confidential information. This means they cannot share or use any of it for the benefit of another person or entity. The franchisee can only share confidential information with employees who need it to fulfill their obligations under the agreement, or if required by law. If legally required to disclose, the franchisee must promptly notify Buona in writing to allow them to seek a protective order or take other appropriate actions.
Buona retains the right to require franchisees, their owners, officers, partners, managers, and employees with access to confidential information to sign a confidentiality agreement. Furthermore, controversies or disputes related to a franchisee's use of Confidential Information will be excluded from arbitration, allowing Buona to pursue other legal remedies.