Under what conditions will Buona not establish or license others to establish a Buona Restaurant in the Development Area?

your Owners) and us. Each Franchise Agreement shall be in the form of Franchise Agreement being offered by us at the time you execute the Franchise Agreement, which may differ from the form of Franchise Agreement being offered by us on the date of execution of this Agreement, except that an addendum to the Franchise Agreement shall be entered into to incorporate terms of this Agreement relating to payments due under each Franchise Agreement. The terms and conditions of each such Franchise Agreement shall control the establishment and operation of such Franchised Restaurant.

• 1.3 Except as otherwise provided in this Agreement, and as long you are in compliance with the Development Schedule and otherwise in compliance with this Agreement, we shall not establish, nor license anyone other than Developer the right to establish any Franchised Restaurant in the Development Area prior to the expiration of the Development Schedule set forth in Exhibit B. As an alternative to a contiguous Development Area in which all Franchised Restaurants will be developed, we may designate a separate Development Area for each Franchised Restaurant to be developed and each specified Development Area will expire according to the development deadlines for that particular Franchised Restaurant as set forth in Exhibit B. We (and any affiliate) reserve the right to:
• (a) distribute products and services which comprise, may in the future comprise or which do not comprise, a part of the System through any alternative distribution channels including, but not limited to, supermarkets and other retail facilities, wholesale sale, catalogs, direct marketing, the Internet or similar electronic media, using the Marks ("Alternate Distribution Channels");
• (b) establish businesses which are franchised, licensed or owned by Franchisor or any affiliate at any locations Franchisor deems appropriate or distribute products or services which are similar to the products and services offered under the System under trade names, trademarks, service marks, trade dress or other commercial symbols other than the Marks.
• (c) to acquire or be acquired by a Franchisor establishing businesses identical or similar to the Franchised Restaurant, even if the other business operates, franchises, and/or licenses competitive businesses anywhere, including the Protected Area; and
• (d) to implement and maintain multi-area marketing programs at any time, including internet and regional or national accounts. Franchisor reserves the right to establish mandatory policies and procedures for these multi-area marketing programs; and
  • (e) to engage in any other business activities not expressly prohibited by this Agreement.

Franchisor Five Flavors Franchising LLC reserves the right to grant franchises and/or development rights for the development of The Original Rainbow Cone Restaurants within any Development Area that is specified only for the development of a Buona Restaurant.

• 1.4 This Agreement is not a Franchise Agreement, and you shall have no right to use in any manner the System or the Marks by virtue of entering into this Agreement.
• 1.5 Developer shall have no right under this Agreement to license others to operate a business or use the System or the Marks.

2. FEES

• 2.1 Concurrent with the execution of this Agreement, you must execute a Franchise Agreement for the first Franchised Restaurant to be developed and pay the initial franchise fees of for the type of Franchised Restaurant to be developed as set forth in Exhibit B. The initial franchise fee for the remaining Franchise Agreements shall be discounted by twenty percent (20%) of the current initial franchise fee on the condition that, at the time you sign any additional Franchise Agreement under this Agreement, you are currently in compliance with the Development Schedule. If you are not in compliance with the Development Schedule at the time of signing any additional franchise agreement, you will pay the then-current full initial franchise fee being charged to new franchisees.
• 2.2 Upon the execution of this Development Agreement, you shall pay a fee ("Development Fee") based on the number and type of additional Franchised Restaurants to be developed after the first franchise restaurant as calculated in Exhibit B to this Agreement. The Development Fee is consideration for this Development Agreement, is fully earned by Franchisor upon execution of this Development Agreement and is non-refundable, notwithstanding any provision to the contrary contained in any Franchise Agreement. However, we will credit the amount of the Development Fee paid for each additional Franchises Restaurant against the Initial Franchise Fee due under each additional single brand and/or dual brand Franchise Agreement for a Franchised Restaurant executed pursuant to, and in accordance with, this Development Agreement.

Source: Item 22 — CONTRACTS (FDD page 78)