Does Buona need to approve the letter of intent and lease before a franchisee executes it for their Buona Business?
Buona Franchise · 2025 FDDAnswer from 2025 FDD Document
Once we have approved a site, you will prepare and submit a letter of intent to the landlord for the site and obtain a proposed lease. We must approve the letter of intent for your lease and the lease for your approved site before you execute them. The factors we consider in approving a lease include but are not limited to whether the terms are commercially reasonable based on the current market conditions, the length of the term, and the rights to cure upon default. In addition, a condition of approval of the lease will be the agreement of the landlord to execute our form of Addendum to Lease and Collateral Assignment of Lease that is attached to the Franchise Agreement as Exhibit B, or alternatively providing similar language in the executed lease in a form approved by us. These requirements apply whether the lessor is an unrelated third party or is an affiliate of yours. If the lease is not approved by us, you must locate another site that meets our approval.
You will provide a copy of the executed lease to us. You will provide to us the names and contact information for your landlord and/or management companies of the approved site of your Buona Business. We reserve the right to contact your landlord and/or management company for the purposes of assessing your performance and customer satisfaction.
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS, AND TRAINING (FDD pages 37–46)
What This Means (2025 FDD)
According to Buona's 2025 Franchise Disclosure Document, Buona requires franchisees to obtain approval for both the letter of intent and the lease agreement before they are executed. This is a standard practice in franchising, allowing Buona to ensure that the lease terms are commercially reasonable and align with their brand standards. The factors Buona considers for lease approval include whether the terms are commercially reasonable based on current market conditions, the length of the term, and the rights to cure upon default.
Buona also requires that the landlord agrees to execute Buona's form of Addendum to Lease and Collateral Assignment of Lease, which is attached as Exhibit B to the Franchise Agreement, or provide similar language in the executed lease in a form approved by Buona. These requirements apply whether the lessor is an unrelated third party or an affiliate of the franchisee. If Buona does not approve the lease, the franchisee must find another site that meets Buona's approval.
This approval process is in place to protect Buona's interests and maintain consistency across all franchise locations. It also helps franchisees avoid potentially unfavorable lease terms that could negatively impact their business. Franchisees are required to provide a copy of the executed lease to Buona, along with the names and contact information for the landlord and/or management companies of the approved site. Buona reserves the right to contact the landlord and/or management company to assess franchisee performance and customer satisfaction.