How many hours of ceased operation can lead to termination of the Buona franchise agreement?
Buona Franchise · 2025 FDDAnswer from 2025 FDD Document
- (b) Franchisee at any time ceases to operate the Franchised Business for fortyeight (48) hours or more or otherwise abandons the Franchised Business, or loses the right to possession of the premises of the Franchised Business, or causes its lease for the premises of the Franchised Business to be terminated, or otherwise forfeits the right to do or transact business in the jurisdiction where the Franchised Business is located.
However, if, through no fault of Franchisee, the premises are damaged or destroyed by an event not within the control of Franchisee such that repairs or reconstruction cannot be completed within six (6) months thereafter, then Franchisee shall have thirty (30) days after such event in which to apply for Franchisor's approval to relocate the Franchised Business and/or reconstruct the premises, which approval shall not be unreasonably withheld, provided Franchisee is not then in default under this Agreement or any other agreement between Franchisee and Franchisor or any of its Affiliates, but may be conditioned upon the payment of an agreed minimum royalty to Franchisor during the period in which the Franchised Business is not in operation;
Source: Item 22 — CONTRACTS (FDD page 78)
What This Means (2025 FDD)
According to Buona's 2025 Franchise Disclosure Document, ceasing operations for a specific duration can lead to the termination of the franchise agreement. Specifically, if a Buona franchisee ceases to operate the franchised business for forty-eight (48) hours or more, it can be grounds for termination.
This clause highlights the importance of maintaining continuous operation of the Buona franchise. Unplanned closures, even for a relatively short period like 48 hours, can have significant repercussions, potentially leading to the loss of the franchise. This underscores the need for franchisees to have robust operational plans and contingency measures in place to prevent such closures.
However, there is an exception. If the premises are damaged or destroyed through no fault of the franchisee, and repairs or reconstruction cannot be completed within six months, the franchisee has 30 days to apply for approval to relocate or reconstruct the premises. Approval will not be unreasonably withheld, provided the franchisee is not in default and may be conditioned upon the payment of an agreed minimum royalty during the period of non-operation. This exception offers some protection to franchisees facing unforeseen circumstances that force a temporary closure.