For Buona franchises developed within the Development Area, what agreement takes precedence if a conflict arises between the Development Agreement and the Franchise Agreement?
Buona Franchise · 2025 FDDAnswer from 2025 FDD Document
For each Franchised Restaurant developed in the Development Area, a separate Franchise Agreement shall be executed and the individual franchise fee as prescribed hereunder shall be paid to us. It is understood and agreed by you that any and all Franchise Agreements executed in connection with Franchised Restaurants developed by you within the Development Area under this Agreement are independent of this Agreement. The continued existence of any such Franchise Agreement shall not depend on the continuing existence of this Agreement. If any conflict shall arise in connection with this Agreement and any Franchise Agreement executed
within the Development Area, the Franchise Agreement shall have precedence and superiority over this Agreement.
Source: Item 22 — CONTRACTS (FDD page 78)
What This Means (2025 FDD)
According to Buona's 2025 Franchise Disclosure Document, when a franchisee develops a Buona restaurant within a Development Area, a separate Franchise Agreement must be executed, and the corresponding franchise fee paid. These individual Franchise Agreements are independent of the overarching Development Agreement. This means the continuation of a Franchise Agreement does not depend on the Development Agreement remaining in effect.
Importantly, if any conflict arises between the Development Agreement and a Franchise Agreement executed within the Development Area, the Franchise Agreement takes precedence. This clause ensures that the specific terms related to the operation of each individual Buona restaurant are prioritized over the broader development terms.
For a prospective Buona franchisee, this means that the terms of their individual Franchise Agreement will govern their restaurant's operations, even if those terms differ from the Development Agreement. This provides a level of assurance that the specific details of their franchise are protected and will be upheld in case of a disagreement between the two agreements.