Does the late payment charge apply to monetary obligations owed to Buona's Affiliates?
Buona Franchise · 2025 FDDAnswer from 2025 FDD Document
If any monetary obligations owed by Franchisee to Franchisor
or to its Affiliates are more than seven (7) days overdue, Franchisee shall, in addition to any other obligations, pay to Franchisor a sum equal to one and one-half percent (1.5%) of the overdue balance per month, or the highest rate permitted by law, whichever is less, from the date said payment is due ("Late Payment Charge").
- 3.6 Pre-Authorized Payment Methods.
Franchisee shall pay for all purchases from, or fees owed to Franchisor or its Affiliates by automated clearing house ("ACH"), as Franchisor may require, or by other means as set forth in this Agreement or in the Manual.
Franchisor or its Affiliates shall have the right to withdraw the entire amount of any amounts owed to Franchisor or its Affiliates from Franchisee's designated bank account ("ACH Account") in accordance with the terms set forth in the Manual, as modified by Franchisor periodically.
Franchisee shall, upon execution of this Agreement or any time after at Franchisor's request, execute all documents or forms as Franchisor determines are necessary for Franchisor to process ACH withdrawals from Franchisee's ACH Account for payments due, including the ACH Authorization Form attached hereto as Exhibit C. Franchisee agrees that it shall be responsible for any ACH transfer fee or similar charge imposed by the bank.
Should any ACH not be honored by Franchisee's bank for any reason, Franchisee shall be responsible for that payment plus any service charge applied by Franchisor and the bank.
Franchisee agrees that any time an ACH transaction is not honored, Franchisee shall pay to Franchisor its then-current non-sufficient funds fee.
Franchisee's failure to maintain, at all times, an ACH Account in accordance with this Agreement shall be a material default of this Agreement.
Source: Item 23 — RECEIPTS (FDD pages 78–356)
What This Means (2025 FDD)
According to Buona's 2025 Franchise Disclosure Document, the late payment charge does apply to monetary obligations owed to Buona's affiliates. Specifically, if any monetary obligations owed by the franchisee to Buona or its affiliates are more than seven days overdue, Buona will charge a late fee.
The late payment charge is a sum equal to 1.5% of the overdue balance per month, or the highest rate permitted by law, whichever is less. This charge accrues from the date the payment was originally due.
Buona requires franchisees to pay for all purchases from, or fees owed to, Buona or its affiliates via automated clearing house (ACH), as Buona may require, or by other means as set forth in the Franchise Agreement or in the Manual. Buona or its affiliates have the right to withdraw the entire amount of any amounts owed from the franchisee's designated bank account in accordance with the terms set forth in the Manual, as modified by Buona periodically. Franchisee will be responsible for any ACH transfer fee or similar charge imposed by the bank. Should any ACH not be honored by Franchisee's bank for any reason, Franchisee shall be responsible for that payment plus any service charge applied by Franchisor and the bank. Franchisee agrees that any time an ACH transaction is not honored, Franchisee shall pay to Franchisor its then-current non-sufficient funds fee. Franchisee's failure to maintain, at all times, an ACH Account in accordance with this Agreement shall be a material default of this Agreement.