Is the Franchisor obligated to cure defaults related to the Franchised Business for a Buona franchise?

According to Buona's 2025 Franchise Disclosure Document, the franchisor is not obligated to cure defaults related to the franchised business. However, Buona has the option to cure any defaults, including paying unpaid bills and liens for construction, labor, and materials. If Buona chooses to cure any defaults, the guarantor must promptly pay Buona all sums expended, along with interest. The interest rate will be the lesser of 1.5% per month or the highest rate allowable under applicable law.

This discretionary right allows Buona to protect its brand and the ongoing operation of the franchise without being legally bound to do so. For a prospective franchisee, this means that if they are in default, they cannot rely on Buona to step in and resolve the issues. The franchisee is ultimately responsible for curing their own defaults.

The FDD also outlines various events that constitute a default, such as failure to pay royalties or submit required reports. The consequences of default can include termination of the franchise agreement. While Buona may choose to assist in curing a default, they are not required to do so, and the franchisee should be prepared to address any defaults independently.

This arrangement is fairly typical in franchising, where the onus is on the franchisee to manage their business and meet their obligations. The franchisor's option to cure defaults provides a safety net, but it should not be seen as a guaranteed solution for a struggling franchisee. Franchisees should maintain open communication with Buona to understand what support might be available in the event of financial or operational difficulties.