How many renewal options does a Buona franchisee have?
Buona Franchise · 2025 FDDAnswer from 2025 FDD Document
The Company charges a monthly royalty fee of 4%, which is computed as a percentage of the franchisee's monthly gross sales. The initial term of the franchise agreement is ten years, with options to extend, provided the franchisee is in compliance with the terms of the agreement.
(h) Franchisee and its manager(s) comply with Franchisor's then-current training requirements and attend such refresher training classes as Franchisor deems necessary.
(i) Franchisee maintains possession of the premises of the Approved Location, or if Franchisee is unable to maintain possession of the Approved Location, secures an approved substitute and agrees to expeditiously develop the substitute premises in compliance with the then current standards and specification for the development of Franchised Businesses; and
(j) Franchisee pays to Franchisor a renewal fee in the amount of Seven Thousand
Five Hundred Dollars ($7,500.00) at least thirty (30) days prior to the signing of the renewal Franchise Agreement.
- 2.3 Effect of Non-Renewal. Franchisee will not have the right to renew this Agreement upon its expiration if Franchisee fails to comply with any of the above conditions of renewal. Upon the expiration of the Term, Franchisee shall comply with the provisions of Article XVI of this Agreement.
- 2.4 Continued Operation Following Expiration. Franchisee has no right to continue to operate the Franchised Business after the expiration of the initial term of this Agreement unless Franchisee is granted a renewal Franchise Agreement in accordance with this Section 2. If Franchisor permits Franchisee to continue to operate the Franchised Business after the expiration of the initial term of this Agreement but before the execution of a renewal Franchise Agreement as required by Section 2.2, then the temporary continuation of the Franchised Business will be on a month-to-month basis, and will be terminable at Franchisor's option by giving Franchisee written notice of termination at least thirty (30) days before the termination is effective. If the laws of the jurisdiction in which the Franchisee or the Franchised Business are located require a longer notice period, the thirty-day period will be deemed modified to be the shortest notice period required by the laws of such jurisdiction.
Source: Item 22 — CONTRACTS (FDD page 78)
What This Means (2025 FDD)
According to Buona's 2025 Franchise Disclosure Document, the initial term of the franchise agreement is ten years, with options to extend, provided the franchisee is in compliance with the terms of the agreement. To renew the franchise agreement, the franchisee must comply with Buona's then-current training requirements, maintain possession of the approved location or secure an approved substitute, and pay a renewal fee of $7,500 at least 30 days prior to signing the renewal agreement.
If a franchisee fails to meet any of the renewal conditions, they will not have the right to renew the agreement upon its expiration. Without a renewal, the franchisee cannot continue to operate the Buona business after the initial term. However, if Buona allows the franchisee to continue operations after the initial term but before a renewal agreement is executed, the business will operate on a month-to-month basis. This temporary arrangement can be terminated by Buona with a written notice of at least 30 days, or the shortest notice period required by local jurisdiction laws.
It is important for prospective Buona franchisees to understand the conditions required for renewal and the implications of non-renewal. Maintaining compliance with the franchise agreement, adhering to training requirements, and securing the location are critical for ensuring the opportunity to extend the franchise term. The renewal fee of $7,500 should also be factored into the franchisee's long-term financial planning.