In California, what is the maximum annual interest rate that Buona can charge, as amended by the addendum?

According to Buona's 2025 Franchise Disclosure Document, an addendum specific to California modifies Item 6 regarding "Other Fees." This modification states that the maximum annual interest rate Buona can charge in California is 10%. This amendment ensures that any interest charged by Buona to its California franchisees on overdue payments or other financial obligations does not exceed this legal limit.

This information is crucial for prospective Buona franchisees in California as it sets a clear expectation regarding potential interest charges. Franchisees should be aware of this limit when reviewing their financial obligations and managing payments to Buona. It is a protective measure ensuring that franchisees are not subjected to excessive interest rates that might be permissible in other states but are capped in California.

It is important for potential franchisees to understand how and when this interest rate might be applied. While the FDD specifies the maximum rate, it does not detail the specific circumstances under which Buona might charge interest. Therefore, prospective franchisees should seek clarification from Buona regarding the specific situations in which interest may be applied, such as late payments or outstanding balances, to fully understand the financial implications.