Does Buona require a franchisee to complete and submit Exhibit C, the Automated Clearing House Payment Authorization Form, and what obligations does this entail for a Buona franchisee?
Buona Franchise · 2025 FDDAnswer from 2025 FDD Document
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 Manuals. 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 Manuals, 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. Franchisor has the right to periodically specify (in the Manuals or otherwise in writing) different payees and/or payment methods, such as weekly/biweekly/monthly payment, payment by auto-draft and payment by check.
- 3.7 Gross Sales.
Source: Item 22 — CONTRACTS (FDD page 78)
What This Means (2025 FDD)
According to Buona's 2025 Franchise Disclosure Document, Exhibit C is the Automated Clearing House Payment Authorization Form. 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.
Upon execution of the Franchise Agreement, or any time after at Buona's request, the franchisee must execute all documents or forms Buona deems necessary to process ACH withdrawals from the franchisee's designated bank account for payments due. This includes the ACH Authorization Form attached as Exhibit C. The franchisee is responsible for any ACH transfer fees or similar charges imposed by their bank.
If an ACH payment is not honored by the franchisee's bank for any reason, the franchisee is responsible for that payment plus any service charge applied by Buona and the bank. Additionally, the franchisee agrees to pay Buona's then-current non-sufficient funds fee any time an ACH transaction is not honored. Failure to maintain an ACH Account in accordance with the agreement constitutes a material default of the agreement. This means Buona can take action against the franchisee for not adhering to the payment terms.
If any monetary obligations owed by the franchisee to Buona or its affiliates are more than seven days overdue, the franchisee must pay Buona a sum equal to 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. Buona will give the franchisee at least 60 days' prior notice before changing the amount of the technology fee.