How will Buona satisfy its obligations when it reserves discretion or agrees to exercise its rights reasonably in the Buona Franchise Agreement?
Buona Franchise · 2025 FDDAnswer from 2025 FDD Document
- 25.7 Franchisor's Reasonable Business Judgment.
Whenever Franchisor reserves discretion in a particular area or where Franchisor agrees to exercise its rights reasonably, in good faith or as it deems necessary or advisable, Franchisor will satisfy its obligations whenever Franchisor exercises reasonable business judgment in making its decision or exercising its rights.
Franchisor's decisions or actions will be deemed to be the result of reasonable business judgment, even if other reasonable or even
Source: Item 22 — CONTRACTS (FDD page 78)
What This Means (2025 FDD)
According to Buona's 2025 Franchise Disclosure Document, when Buona reserves discretion in a particular area or agrees to exercise its rights reasonably, in good faith, or as it deems necessary or advisable, Buona will meet its obligations by exercising reasonable business judgment in making decisions or exercising its rights.
Buona's decisions or actions will be considered the result of reasonable business judgment even if other reasonable or better options exist. This clause provides Buona with leeway in its decision-making, as long as it can demonstrate that its choices are based on reasonable business considerations.
For a prospective franchisee, this means that Buona has significant discretion in many aspects of the franchise agreement. While Buona is expected to act reasonably and in good faith, the definition of 'reasonable business judgment' allows for a range of possible actions. Franchisees should be aware that Buona's decisions may not always align with what the franchisee perceives as the best course of action, but as long as Buona's decision-making process is grounded in reasonable business principles, it will be deemed compliant with the agreement.