What criteria must a transferee meet to the satisfaction of Buona to be approved?
Buona Franchise · 2025 FDDAnswer from 2025 FDD Document
(c) The transferee must be of good moral character and reputation, in the reasonable judgment of Franchisor;
(d) Franchisor shall have determined, to its satisfaction, that the transferee's qualifications meet Franchisor's then-current criteria for new franchisees;
(e) The terms and conditions of the proposed transfer, including all financial terms of the proposed transfer, shall be provided in writing to Franchisor at least fifteen (15) business days prior to the proposed effective date of the transfer, and shall be approved in writing by Franchisor;
(f) The transferee shall execute, at Franchisor's option, (i) written assignment, in form satisfactory to Franchisor, pursuant to which the transferee shall assume all of the obligations of Franchisee under this Agreement and any other agreement relating to the Franchised Business to be transferred; or (ii) Franchisor's then-current form of dual brand Franchise Agreement and such other then-current ancillary agreements as Franchisor may reasonably require.
The then-current form of the Franchise Agreement may contain new or significantly different terms, including but not limited to a higher royalty fee and advertising fund contribution and less territorial protection than contained in this Agreement.
The then-current form of the Franchise Agreement will expire on the expiration date of this Agreement and will contain the same renewal rights, if any, as are available to Franchisee under this Agreement;
(g) Franchisee shall execute a general release in favor of Franchisor and its Affiliates of any claims it may have against Franchisor and its Affiliates, or their shareholders, officers, directors, members, managers, employees and agents, predecessors, successors and assigns relating to the Franchised Business, unconditionally releasing them from any and all claims Franchisee might have against Franchisor and its Affiliates, or their shareholders, officers, directors, members, managers, employees and agents, predecessors, successor and assigns, as of the date of the assignment;
(h) The transferee shall agree at its sole cost and expense, to complete a Franchised Business Renovation, within the time frame required by Franchisor, unless a Franchised Business Renovation was completed less than five (5) years prior to the date of the transfer, and perform such other scope of work as may be determined by Franchisor;
Source: Item 22 — CONTRACTS (FDD page 78)
What This Means (2025 FDD)
According to Buona's 2025 Franchise Disclosure Document, a franchisee needs to meet several conditions to transfer their franchise. Buona emphasizes that franchise rights are personal and granted based on the franchisee's skills and financial capacity. Therefore, any transfer requires Buona's prior written consent.
To gain approval for a transfer, the potential transferee must first be of good moral character and reputation, as judged reasonably by Buona. Additionally, the transferee's qualifications must meet Buona's current criteria for new franchisees. The financial and other terms of the proposed transfer must be provided to Buona at least fifteen business days before the intended transfer date and must receive written approval from Buona.
The transferee may also need to execute a written assignment or Buona's current franchise agreement, which might include different terms such as higher fees or reduced territorial protection. The franchisee must also provide a general release of claims against Buona. Finally, the transferee may be required to complete a Franchised Business Renovation at their own cost, unless a renovation was recently completed.