Where in the Buona Franchise Agreement are territorial development and sales quotas discussed?
Buona Franchise · 2025 FDDAnswer from 2025 FDD Document
[Item 12: TERRITORY]
Continuation of your rights to the Protected Area is not dependent upon achieving a certain sales volume, market penetration or other or market penetration or other contingency. We cannot alter your territorial rights.
Area Development Agreement
Under the Area Development Agreement, an exclusive territory is designated within which it is expected you will develop the multiple Buona Businesses during the term of the Area Development Agreement ("Development Area"). The Development Area will be described in Exhibit A to the Area Development Agreement. The size of the Development Area will vary and will depend on the number of restaurants you intend to open, our analysis of the market potential and your financial and operational abilities.
As long you are in compliance with the Development Schedule and otherwise in compliance with the Area Development Agreement, during the term of the Area Development Agreement, we will not establish, nor license anyone other than Developer the right to establish any Buona Business in the Development Area.
If you default in your obligations under the Development Schedule, we may, in our sole discretion, do any one or more of the following: (i) immediately terminate the Area Development Agreement and all rights granted under to you without affording you any opportunity to cure the default effective by delivery to you of a written notice from us; (ii) reduc
[Item 23: RECEIPTS]
Franchisee shall use its best efforts to develop and promote the Franchised Business.
All Buona products must be sold by Franchisee only from the Approved Location.
Franchisee may not use other channels of distribution such as the internet, catalog sales, telemarketing or other direct marketing to make sales 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.
Source: Item 9 — FRANCHISEE'S OBLIGATIONS (FDD pages 34–37)
What This Means (2025 FDD)
According to Buona's 2025 Franchise Disclosure Document, Item 12 discusses territory, including the Area Development Agreement. The Area Development Agreement grants an exclusive territory where the developer is expected to develop multiple Buona businesses during the agreement's term. The size of this development area depends on the number of restaurants the developer intends to open, Buona's analysis of market potential, and the developer's financial and operational abilities.
The FDD states that continuation of rights to the Protected Area is not dependent upon achieving a certain sales volume, market penetration, or other contingency. However, the continued exclusive rights to the Development Area are dependent upon meeting all of the deadlines in the Development Schedule. If the developer defaults on obligations under the Development Schedule, Buona may terminate the Area Development Agreement and all rights granted without any opportunity to cure the default.
The Franchise Agreement, as detailed in Item 23, also stipulates that the franchisee must use its best efforts to develop and promote the Franchised Business. All Buona products must be sold by the franchisee only from the Approved Location. The franchisee may not use other channels of distribution such as the internet, catalog sales, telemarketing, or other direct marketing to make sales 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.