Does acceptance of royalty fees from a potential transferee constitute approval of the transfer by Buona?

According to Buona's 2025 Franchise Disclosure Document, the acceptance of royalty fees or any other payments from a potential transferee does not automatically constitute approval of the transfer by Buona. The document explicitly states that Buona's acceptance of such payments from a third party, including a proposed transferee, does not imply approval of that party as a transferee or the transfer of the Franchise Agreement. This protects Buona's right to thoroughly vet and approve any potential new franchisee.

This provision is important for prospective Buona franchisees because it clarifies that even if a potential buyer begins paying royalties, the transfer is not finalized until Buona provides explicit written consent. A franchisee cannot assume that a transfer is approved simply because Buona is accepting payments from the proposed transferee. This protects Buona and ensures that all potential franchisees meet the brand's standards and qualifications.

Furthermore, any transfer of the franchise without Buona's prior written consent is considered null and void and constitutes a material breach of the Franchise Agreement. This gives Buona the right to terminate the agreement without allowing the franchisee an opportunity to correct the breach. Therefore, it is crucial for franchisees to obtain written approval from Buona before proceeding with any transfer to avoid potential legal and financial repercussions.