Under what conditions is a Buona franchisee prohibited from making statements or agreements with a threatening party without the Franchisor's written consent?
Buona Franchise · 2025 FDDAnswer from 2025 FDD Document
- A. delivers to Franchisor prompt written notice of the threat;
- B. grants Franchisor written authorization to take unrestricted control over the defense and settlement of the threat with counsel of its choice;
- C. did not cause or give rise to the threat due to a material failure to comply with Franchisor's previously communicated trademark usage requirements;
- D. cooperates promptly and fully with Franchisor in the defense, mitigation, and/or settlement of the threat; and
- E. does not jeopardize or compromise any right, defense, obligation or liability of Franchisor, by making any statement to, or entering into any agreement with, the threatening party which does not have the advance written consent of Franchisor, unless required by applicable law."
Source: Item 22 — CONTRACTS (FDD page 78)
What This Means (2025 FDD)
According to Buona's 2025 Franchise Disclosure Document, a franchisee is prohibited from making statements or entering into agreements with a threatening party without Buona's advance written consent under specific conditions. This restriction applies if the franchisee's actions could jeopardize or compromise any right, defense, obligation, or liability of Buona.
This condition is part of a broader set of requirements that a Buona franchisee must meet when facing a threat. These include promptly notifying Buona of the threat in writing, granting Buona written authorization to control the defense and settlement of the threat with counsel of its choice, ensuring that the threat was not caused by the franchisee's failure to comply with Buona's trademark usage requirements, and fully cooperating with Buona in the defense, mitigation, and/or settlement of the threat.
For a prospective Buona franchisee, this means that in the event of a legal or other threat, they must relinquish control to Buona and follow their instructions. Failure to do so, especially by making unauthorized statements or agreements, could have legal and financial repercussions for both the franchisee and Buona. This clause ensures that Buona maintains control over its brand and legal position, even when the threat directly involves a franchisee.