Under the Buona Area Development Agreement, what is the minimum number of Franchised Restaurants a Developer is obligated to develop, open, and operate?

According to Buona's 2025 Franchise Disclosure Document, a developer entering into an Area Development Agreement is obligated to develop, open, and operate a minimum of three Buona restaurants. This requirement is outlined in Exhibit B to the Area Development Agreement, which details the development schedule. The developer must adhere to this schedule to remain in compliance with the agreement.

This obligation has significant implications for potential Buona developers. It means committing to a multi-unit expansion from the outset, requiring substantial capital investment and operational capabilities. The developer must secure franchise agreements, leases, or purchase agreements for the sites and commence operations according to the agreed-upon timeline. Failing to meet these development milestones could result in a breach of the Area Development Agreement.

However, the agreement also allows developers to open Buona restaurants earlier than the dates specified in the development schedule, provided they comply with the agreement and the applicable Franchise Agreement. This flexibility can be beneficial for developers who are ready to expand more quickly. The franchisee for each Franchise Agreement may be a separate entity owned by the developer's Owners.

Prospective developers should carefully review the Development Schedule in Exhibit B of the Area Development Agreement to fully understand the required timelines and obligations. They should also assess their financial and operational capacity to ensure they can meet the minimum development requirements. Understanding these obligations is crucial for making an informed decision about entering into an Area Development Agreement with Buona.