What is the minimum service charge Aw franchisees may be charged on overdue accounts?
Aw Franchise · 2025 FDDAnswer from 2025 FDD Document
| TYPE OF FEE1,3 | AMOUNT | DUE DATE | REMARKS |
|---|---|---|---|
| Service Charge | Greater of $150 or the highest interest rate allowed by law not to exceed 1 ½%. | Upon billing | Payable on all overdue accounts due to us. |
Source: Item 6 — OTHER FEES (FDD pages 13–16)
What This Means (2025 FDD)
According to Aw's 2025 Franchise Disclosure Document, franchisees may incur a service charge on overdue accounts. This service charge is the greater of $150 or the highest interest rate allowed by law, but it will not exceed 1 ½%. This charge is payable upon billing for all overdue amounts owed to Aw.
For a prospective Aw franchisee, this means that if you fail to pay amounts owed to Aw on time, you will be charged a minimum of $150. However, if the highest interest rate allowed by law is greater than $150, that interest rate will be charged instead, up to a maximum of 1 ½%.
It is important for franchisees to manage their accounts carefully to avoid these charges. Franchisees should be aware of the due dates for all payments to Aw and ensure that payments are made on time to avoid incurring service charges. This is a fairly standard practice in franchising, as franchisors need to ensure timely payments to maintain their own financial stability and support services for all franchisees.