How is the overdue balance calculated for the Buona late payment charge?
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").
Source: Item 23 — RECEIPTS (FDD pages 78–356)
What This Means (2025 FDD)
According to Buona's 2025 Franchise Disclosure Document, if a franchisee's monetary obligations to Buona or its affiliates are more than seven days overdue, Buona will charge a late fee. This late payment charge is calculated as one and one-half percent (1.5%) of the overdue balance per month. However, if the highest rate permitted by law is lower than 1.5%, the late payment charge will be the highest rate permitted by law. The late payment charge is applied from the original date the payment was due.
In practical terms, this means that if a Buona franchisee fails to pay fees or other amounts owed to Buona within seven days of the due date, they will incur a monthly late fee of 1.5% on the outstanding amount. This can significantly increase the amount owed over time, so it is crucial for franchisees to manage their finances carefully and ensure timely payments.
It's important for prospective Buona franchisees to understand this late payment policy and factor it into their financial planning. Franchisees should also be aware of any applicable state laws that may limit the amount of the late payment charge. Maintaining open communication with Buona regarding payment issues can help avoid or mitigate potential late payment charges.