What is the dependency for determining the Protected Area for a Buona franchise?
Buona Franchise · 2025 FDDAnswer from 2025 FDD Document
s outside of and apart from the operation of the Franchised Business at the Approved Location without Franchisor's prior written consent, which may be withheld by Franchisor in its sole discretion.
- 1.3 Protected Area. Subject to the terms and conditions of this Agreement and provided Franchisee or any of its affiliated companies is not otherwise in default of this Agreement or in default of any other agreement with Franchisor or with a parent, subsidiary or affiliate of Franchisor ("Affiliates"), Franchisor shall not establish, nor grant another the right to establish a Buona Restaurant during the Term, within the area described in Exhibit A of this Agreement (the "Buona Protected Area"), without Franchisee's prior written consent. The Buona Protected Area will be a geographic area around the Approved Location with a minimum people population of Sixty Thousand (60,000) if the Approved Location is in a non-urban location and a one-half (1/2) mile radius around the Approved Location if it is located in an urban area. Upon determination of the Approved Location, Franchisor and Franchisee shall complete and execute Exhibit A with a description of the Buona Protected Area. Franchisee is not granted a protected area or any exclusive rights relating to The Original Rainbow Cone portion of the Franchised Business.
- 1.4 Limitations to Protected Area. The provisions of Section 1.3 shall not apply if the Franchised Business is operated in any of the following types of locations and/or with respect to such locations within the Buona Protected Area ("Captive Locations"), at which Franchisor retains the right, in its sole discretion, to franchise and/or operate Franchised Businesses, and to distribute by any means products and services of the System:
- (a) Transportation facilities (including but not limited to airports, train stations, bus stations, etc.);
Source: Item 23 — RECEIPTS (FDD pages 78–356)
What This Means (2025 FDD)
According to Buona's 2025 Franchise Disclosure Document, the determination of the Protected Area depends on whether the Approved Location is in an urban or non-urban area. For a non-urban location, the Protected Area will have a minimum population of 60,000 people. If the Approved Location is in an urban area, the Protected Area will be a one-half (1/2) mile radius around the Approved Location.
Buona and the franchisee will complete and execute Exhibit A, which will describe the Protected Area, upon determination of the Approved Location. This exhibit is a crucial part of the franchise agreement as it defines the area where Buona will not establish or grant another franchise the right to establish a Buona Restaurant during the term of the agreement, without the franchisee's prior written consent. This protection is subject to the franchisee remaining in compliance with the agreement and other agreements with Buona or its affiliates.
However, the Protected Area has limitations. Buona retains the right to franchise or operate Buona Businesses in certain types of locations within the Protected Area, referred to as "Captive Locations". These include transportation facilities, educational facilities, institutional feeding facilities, and government institutions. This means that even within a franchisee's Protected Area, Buona can still establish a presence in these specific locations, which could impact the franchisee's potential customer base and revenue.