What is the Development Fee for each additional Buona Restaurant to be developed under the Development Agreement?
Buona Franchise · 2025 FDDAnswer from 2025 FDD Document
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Development Schedule. If you are not in compliance with the Development Schedule at the time of signing any additional franchise agreement, you will pay the then-current initial franchise fee being charged to new franchisees if it is greater than Thirty-Two Thousand Dollars ($32,000.00).
2.2 Upon the execution of this Development Agreement, you shall pay a fee ("Development Fee") in the amount of Sixteen Thousand Dollars ($16,000.00) times the number of additional Buona Restaurants to be developed after the one for which Developer is signing a Franchise Agreement contemporaneously with this Development Agreement. The Development Fee is consideration for this Development Agreement, is fully earned by Franchisor upon execution of this Development Agreement and is non-refundable, notwithstanding any provision to the contrary contained in any Franchise Agreement. However, we will credit Sixteen Thousand Dollars ($16,000.00) of the Development Fee against the Initial Franchise Fee for each additional Franchise Agreement for a Buona Restaurant executed pursuant to, and in accordance with, this Development Agreement.
Source: Item 22 — CONTRACTS (FDD page 78)
What This Means (2025 FDD)
According to Buona's 2025 Franchise Disclosure Document, a Development Fee of $16,000 is required for each additional Buona Restaurant to be developed under the Development Agreement. This fee compensates Buona for granting the development rights and is earned fully upon the execution of the Development Agreement and is non-refundable. However, Buona will credit $16,000 of the Development Fee against the Initial Franchise Fee for each additional Franchise Agreement.
This means that if a franchisee signs a Development Agreement to open multiple Buona restaurants, they will pay $16,000 per restaurant upfront as a Development Fee. This fee is non-refundable, regardless of whether the franchisee ultimately opens all the restaurants outlined in the agreement. However, this fee is not an additional cost, as it is later credited towards the initial franchise fee for each location.
It's important to note that if the franchisee fails to comply with the Development Schedule at the time of signing any additional franchise agreement, they may be required to pay the then-current initial franchise fee being charged to new franchisees if it is greater than $32,000.00. This highlights the importance of adhering to the agreed-upon development timeline to avoid potentially higher fees.