factual

Who is responsible for the final selection of a site for a Buona franchise?

Buona Franchise · 2025 FDD

Answer from 2025 FDD Document

lian Beef Franchising, LLC and Five Flavors Franchising LLC dated _____________. Reference is made to the provisions of said Franchise Agreement and to the governing documents of [name of Franchisee Entity].

6.2 Site Selection and Approval. If the location is not designated on Exhibit A at the time this Agreement is executed, it is Franchisee's sole responsibility to undertake site selection activities and otherwise secure the premises for the Franchised Business. Prior to entering into a lease for a site, Franchisee must submit to Franchisor a site evaluation form for the proposed site, together with a letter of intent, proposed lease, or other evidence satisfactory to Franchisor which confirms Franchisee's favorable prospects for obtaining the proposed site. Franchisor in its discretion shall determine what factors it will consider in approving or disapproving a site, including but not limited to characteristics of the location and premises and financial terms of the proposed purchase agreement or lease. In the event that Franchisee proposes to lease the proposed site from an affiliated entity, or an entity that includes any member or shareholder of the Franchisee business entity as a member or shareholder, Franchisor may be required to submit a proforma and/or draft lease to Franchisor before a determination is made by Franchisor regarding approval of the site. Franchisee or the affiliated entity shall not secure financing or purchase the property until the site has been approved by Franchisor. Franchisor will provide Franchisee written notice of approval or disapproval of the proposed site within thirty (30) days after receiving Franchisee's written proposal and all required documents. Franchisee must obtain Franchisee's written approval

of a proposed site before entering into a lease. Franchisee must have a proposed site approved by Franchisor within nine (9) months of the date of the execution of this Agreement. Franchisor has the unilateral right (but not the obligation) to terminate the Agreement upon delivery of notice to Franchisee if Franchisee has not obtained Franchisor's written approval of a site for the Franchised Business within time frames described above. While Franchisor may use its experience in providing any assistance to Franchisee regarding site selection and in approving a site, nothing contained herein shall be interpreted as a guarantee of success for said location.

  • 6.3 Lease of Premises. Any letter of intent lease for the premises of a Franchised Business and any proposed lease for the premises of the Franchised Business must be approved by Franchisor before it is executed by Franchisee. Franchisor may, in its discretion, require that the letter of intent and the lease contain commercially reasonable terms based on current market conditions and that certain terms and provisions be included in the letter of intent and the lease. Franchisor's approval of the lease shall also be conditioned upon the landlord's execution of the Addendum to Lease and Collateral Assignment attached hereto as Exhibit B, or inclusion in the lease of the same or similar terms as approved by Franchisor. . The requirements set forth herein apply whether the lessor is an unrelated third party or is an affiliate of Franchisee. Once executed, Franchisee will provide Franchisor with a fully signed copy of the complete lease for the premises of the Franchised Business.
  • 6.4 Premises Development**.** Prior to obtaining possession of the site for the Franchised Business, Franchisee shall secure all financing required to fully develop the Franchised Business. Promptly after obtaining possession of the site for the Franchised Business, Franchisee will: (i) cause to be prepared and submit for approval by Franchisor a site plan. Franchisor shall then provide basic drawings and specifications, including requirements for dimensions, exterior design, materials, interior layout, equipment, fixtures, furniture, signs, and decorating required for the development of the Franchised Business; Franchisee is required to hire a licensed architect designated by Franchisor and have these drawings and specifications modified by the architect as required, to meet applicable ordinances, building codes or permit requirements (Franchisor must approve any such modifications to the drawings and specifications);

Source: Item 23 — RECEIPTS (FDD pages 78–356)

What This Means (2025 FDD)

According to Buona's 2025 Franchise Disclosure Document, the franchisee is primarily responsible for site selection. However, Buona retains significant control over the final approval of the site. The franchisee must undertake site selection activities and secure the premises. This includes submitting a site evaluation form, a letter of intent, and a proposed lease to Buona for approval.

Buona has the discretion to determine the factors it will consider when approving or disapproving a site. These factors include the characteristics of the location and premises, as well as the financial terms of the proposed purchase agreement or lease. If the franchisee intends to lease the site from an affiliated entity, Buona may require additional financial information, such as a proforma or draft lease, before making a decision.

Ultimately, the franchisee cannot finalize financing or purchase the property until Buona has given its written approval. Buona will provide written notice of approval or disapproval within thirty days of receiving the franchisee's complete proposal. The franchisee must obtain this approval within nine months of signing the franchise agreement. Buona has the right to terminate the agreement if the franchisee fails to secure site approval within this timeframe. While Buona may offer assistance during site selection, this does not guarantee the location's success.

Furthermore, any letter of intent or proposed lease must be approved by Buona before the franchisee executes it. Buona may require commercially reasonable terms in the lease based on current market conditions and may also mandate specific terms and provisions. The landlord must also execute an addendum to the lease or include similar terms approved by Buona. After the lease is signed, the franchisee must provide Buona with a copy of the complete lease. Once the site is secured, the franchisee must submit a site plan for Buona's approval and adhere to Buona's standard plans and specifications for development, including hiring a licensed architect designated by Buona.

Disclaimer: This information is extracted from the 2025 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.