What is the purpose of the late charge for the Bumble Roofing promissory note?
Bumble_Roofing Franchise · 2025 FDDAnswer from 2025 FDD Document
Any payment is late if not received by holder within 10 days after it is due.
If a payment is late, holder may, in its sole discretion elect to;
- A.
Declare the entire unpaid principal and interest balances immediately due and payable; or
- B.
Accept the late payment along with a late charge in the amount of 10% of the amount of the late payment.
The late charge will be for the purpose of compensating holder for additional expenses which it is recognized that holder will incur as a result of the late payment.
Source: Item 23 — RECEIPT (FDD pages 53–188)
What This Means (2025 FDD)
According to the 2025 Bumble Roofing FDD, the late charge associated with the promissory note is intended to compensate the note holder for the additional expenses they incur as a result of a payment being late. If a payment is not received within 10 days of its due date, it is considered late.
In the event of a late payment, Bumble Roofing has the option to either declare the entire unpaid principal and interest immediately due or accept the late payment along with a late charge. The late charge is calculated as 10% of the amount of the late payment.
It is important for prospective Bumble Roofing franchisees to understand these terms, as late payments can lead to additional charges and, in more severe cases, the acceleration of the entire debt or even termination of the franchise agreement. Therefore, maintaining timely payments is crucial to avoid these potential negative consequences.