Under what circumstances will Buona grant permission for relocation of a Franchised Business?
Buona Franchise · 2025 FDDAnswer from 2025 FDD Document
d Franchisee has been making reasonable efforts to open the Franchised Business, Franchisor may (in its sole discretion) agree to extend the date for opening for an additional reasonable amount of time
determined by Franchisor based on the circumstances.
6.6 Relocation of Store.
- (a) If Franchisee's lease for the premise of the Franchised Business terminates without fault of Franchisee, or expires without any possibility of renewal by Franchisee on commercially reasonable terms as determined by Franchisor, or if in the judgment of Franchisor and Franchisee there is a change in the character of the location of the Franchised Business sufficiently detrimental to its business potential to warrant its relocation, Franchisor shall grant permission for relocation of the Franchised Business to a location approved by Franchisor. Franchisee may not open a relocated Franchised Business without the onsite presence of Franchisor's representative, unless a waiver is requested in writing by Franchisee and approved in writing by Franchisor. Even if the aforementioned request and approval are granted, Franchisee must obtain Franchisor's written authorization, in its sole discretion, of the specific date that the Franchised Business may open. In the event of relocation, the parties will enter into an agreement which will set forth the new location for Franchisee's Franchised Business and a deadline by which Franchisee must open for business at the new location, after which time Franchisee will be obligated to resume paying the royalty and Marketing Fund Contributions whether or not the new location has opened for business. Until such time that the new location is open for business, the amount of the royalty and Marketing Fund Contribution will be based on the Franchisee's average weekly level of Gross Sales during the one-year period prior to closing the first Franchised Business. Any such relocation shall be at Franchisee's sole expense, and shall not be undertaken without Franchisor's prior written consent. Franchisee shall pay to Franchisor a relocation fee in the amount of fifty percent (50%) of the then-current Initial Franchise Fee to cover Franchisor's services and associated costs in connection with such relocation, including those related to (i) reviewing and approving the new location and the construction drawings for the Franchised Business at its new location and (ii) providing additional on-site training and assistance. Franchisee shall pay fifty percent (50%) of the relocation fee when Franchisor grants the approval to relocate and the balance of the relocation fee upon Franchisor's acceptance of the new location for the Franchised Business.
- (b) Franchisor shall also have the right to require Franchisee to upgrade the relocated Franchised Business to conform to Franchisor's then current image, standards, and specifications for construction and equipment for all new Franchised Businesses.
- (c) In the event of a relocation of the Franchised Business, Franchisee shall promptly remove from the former Franchised Business premises any and all signs, fixtures, furniture, posters, furnishings, equipment, menus, advertising materials, stationery, supplies, forms and other articles which display any of the Marks and distinctive features or designs associated with the System. Any articles which display any of the Marks or any distinctive features or designs associated with the System which are not used by Franchisee at the new Franchised Business location shall be disposed of by Franchisee as directed by Franchisor following notice to Franchisor to the effect such articles will not be used at the new Franchised Business.
Source: Item 22 — CONTRACTS (FDD page 78)
What This Means (2025 FDD)
According to Buona's 2025 Franchise Disclosure Document, Buona will grant permission for relocation of a franchised business under specific circumstances. These circumstances include the termination of the franchisee's lease without fault, the expiration of the lease without commercially reasonable renewal options, or a significant change in the location's character that negatively impacts its business potential, as judged by both Buona and the franchisee. This provision ensures that franchisees have options if their initial location becomes untenable due to factors beyond their control.
However, any relocation is contingent on Buona's approval of the new location. The franchisee cannot open the relocated business without the on-site presence of Buona's representative, unless a written waiver is requested by the franchisee and approved by Buona. Even with an approved waiver, the franchisee must obtain Buona's written authorization for the specific date the relocated business can open. This level of oversight allows Buona to maintain brand consistency and operational standards at the new location.
In the event of relocation, the franchisee must enter into an agreement that specifies the new location and a deadline for opening the relocated business. After this deadline, the franchisee is obligated to resume royalty and marketing fund contributions, regardless of whether the new location is open. Until the new location opens, these contributions will be based on the franchisee's average weekly gross sales during the year before closing the original location. The franchisee bears the sole expense of the relocation and must pay Buona a relocation fee equal to fifty percent (50%) of the then-current initial franchise fee. This fee covers Buona's services and costs related to reviewing and approving the new location, construction drawings, and providing additional on-site training and assistance.
Compliance with de-identification of the former franchised business premises is a condition for Buona's approval of any relocation request. Failure to properly de-identify the former premises allows Buona to revoke its permission for relocation and declare a default under the agreement. Additionally, if a franchisee loses possession of the franchised business before the agreement's term expires, they must diligently seek a new location and reopen the business as quickly as possible. Failure to do so may result in liability for liquidated damages to Buona.