When is the insufficient funds/late report fee due for an Alloy franchise?
Alloy Franchise · 2025 FDDAnswer from 2025 FDD Document
penses to be paid include your attendees' |
| Name of Fee (1) | Amount | Date Due | Remarks |
|---|---|---|---|
| travel, lodging, meals, and wages | |||
| Insufficient Funds/Late Report Fee | $100 fee for late report/late payment, with fee increasing by $50 for each subsequent late report/late payment (up to a maximum of $250 for the fourth and any subsequent late report/late payment | On demand, if incurred | You must pay us this fee if there are not sufficient funds in your bank account to process payments owed to us and/or our affiliates or you are late in submitting reports. If you incur this fee three times in any 12 month period, we may terminate your Franchise Agreement withou |
Source: Item 6 — OTHER FEES (FDD pages 15–20)
What This Means (2025 FDD)
According to Alloy's 2025 Franchise Disclosure Document, the insufficient funds/late report fee is due on demand, if incurred. This means that if an Alloy franchisee's bank account does not have sufficient funds to cover payments owed to Alloy or its affiliates, or if the franchisee submits reports late, the fee is immediately due upon Alloy's demand.
The fee for a late report or late payment is $100, but it increases by $50 for each subsequent late report or late payment, up to a maximum of $250 for the fourth and any subsequent late report or late payment. This escalating fee structure is designed to encourage timely payments and report submissions.
It's important to note that if an Alloy franchisee incurs this fee three times within any 12-month period, Alloy has the right to terminate the Franchise Agreement without providing an opportunity to correct the default. This highlights the importance of maintaining sufficient funds and submitting reports on time to avoid potential penalties and the risk of losing the franchise. Franchisees should ensure they have systems in place to manage their finances and reporting obligations effectively.