What is the APR that Bhc charges for underpayment of fees, and what is the exception to this rate?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
If an examination or audit discloses any underpayment of any fee, you must promptly pay the deficient amount plus interest calculated daily from the due date until paid at an APR of 18% (unless interest rates on delinquent payments in the state in which Franchisee's Master Franchised BHC Restaurant is located are limited by law to a lower APR, in which case that lower APR will apply).
Source: Item 6 — Other Fees (FDD pages 12–18)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, if an audit reveals any underpayment of fees, Bhc will charge interest on the deficient amount. This interest is calculated daily from the due date until the payment is made. The standard annual percentage rate (APR) for this interest is 18%.
However, there is an exception to this 18% APR. If the interest rates on delinquent payments are legally limited to a lower APR in the state where the franchisee's Master Franchised Bhc Restaurant is located, that lower APR will be applied instead. This means that Bhc will adhere to state laws that cap interest rates at a level below 18%.
This policy ensures that Bhc franchisees are charged a fair interest rate on underpaid fees, while also complying with local regulations. Franchisees should be aware of the interest rate laws in their specific state to understand the potential APR that could be applied to any underpayments.