If a Brueggers Bagels franchisee underpays royalties, what interest and late fees apply?
Brueggers_Bagels Franchise · 2025 FDDAnswer from 2025 FDD Document
n the Account at all times to cover all royalty fees, Brand Marketing Fund contributions and other fees payable to us or our affiliates. If funds in the Account are insufficient to cover the amounts payable at the time we make our weekly electronic funds transfer, the amount of the shortfall will be deemed overdue.
- 5.5. Interest and Late Fees. If any sums required to be paid by you to us under this Agreement are not received in full by us when due, we will assess a late fee of one hundred dollars ($100) for each week that any payment is delinquent. In addition, if any payment to us is overdue, you must pay us, in addition to the overdue amount, daily interest on the overdue amount from the date it became overdue until paid, at the rate of one and one-half percent (1.5%) per month or the maximum rate permitted by law, whichever is less. Interest shall be calculated on a daily basis. Inter
Source: Item 22 — CONTRACTS (FDD page 61)
What This Means (2025 FDD)
According to Brueggers Bagels' 2025 Franchise Disclosure Document, franchisees are subject to interest and late fees for underpayment of royalties. Specifically, if any payment is not received in full when due, Brueggers Bagels will assess a late fee of $100 for each week the payment is delinquent.
In addition to the late fee, any overdue payment accrues daily interest from the date it became overdue until it is paid. The interest rate is 1.5% per month, or the maximum rate permitted by law, whichever is less. This interest is calculated on a daily basis and is non-refundable.
It's important to note that failure to maintain sufficient funds in the designated account for payments or failure to pay all amounts when due constitutes grounds for termination of the Franchise Agreement. This highlights the importance of franchisees managing their finances carefully to avoid penalties and potential termination of their franchise agreement with Brueggers Bagels.