Is Benihana required to participate in an electronic funds transfer program?
Benihana Franchise · 2024 FDDAnswer from 2024 FDD Document
NOTES:
- (1) Except as noted in the above charts, all fees are imposed by and are payable to us. All fees are non-refundable. You must participate in our electronic funds transfer program, which authorizes us to utilize a pre-authorized bank draft system. You must sign and deliver to us an unconditional, irrevocable authorization to enable our financial institution to debit bank accounts at your bank in order to pay us any Royalties, Advertising Contributions, and other amounts that you may owe us under the Franchise Agreement or any other agreement between you and us. All Royalties, Advertising Contributions, and other amounts due to us must be received by us or credited to our account by pre-authorized bank debit before 5:00 p.m. on the day each such payment is due.
- (2) Interest, payable upon demand, begins from the date of the non-payment or underpayment to the date of payment at a rate of 18% per annum or the maximum rate allowed by applicable law, if that maximum legal is less than 18% per annum.
Source: Item 6 — OTHER FEES (FDD pages 18–21)
What This Means (2024 FDD)
According to Benihana's 2024 Franchise Disclosure Document, franchisees are required to participate in the company's electronic funds transfer (EFT) program. This program authorizes Benihana to use a pre-authorized bank draft system to debit the franchisee's bank account for payments.
Specifically, franchisees must sign and deliver an unconditional, irrevocable authorization that allows Benihana's financial institution to debit funds from the franchisee's bank account. This covers royalties, advertising contributions, and any other amounts owed to Benihana under the Franchise Agreement or any other agreement between the franchisee and Benihana.
All royalties, advertising contributions, and other payments due to Benihana must be received or credited to their account via pre-authorized bank debit before 5:00 p.m. on the day the payment is due. This mandatory EFT program ensures that Benihana receives timely payments and maintains consistent cash flow from its franchise operations.