What is the monthly interest rate charged on late Advertising Fees for a Carbones Pizzeria franchise?
Carbones_Pizzeria Franchise · 2025 FDDAnswer from 2025 FDD Document
- e. Advertising Fees not paid by Franchisee as required herein shall bear interest at the rate of one and a half percent (1.5%) per month, provided, however, that in no event shall the rate of interest payable by Franchisee on any unpaid balance under this Agreement exceed the maximum legal rate under applicable law.
Source: Item 23 — RECEIPTS (FDD pages 30–116)
What This Means (2025 FDD)
According to the 2025 Carbones Pizzeria Franchise Disclosure Document, if a franchisee fails to pay their Advertising Fees on time, they will incur a monthly interest charge of 1.5%. However, the agreement specifies that this interest rate will not exceed the maximum legal rate permitted by applicable law. This means that if state law sets a lower maximum interest rate, that lower rate will apply instead of the 1.5%.
This late fee policy is fairly standard in franchising. The purpose is to incentivize timely payments and compensate Carbones Pizzeria for the administrative burden and potential cash flow issues caused by late payments. The clause about adhering to the maximum legal rate is a protective measure, ensuring that the franchise agreement remains compliant with varying state regulations regarding interest charges.
For a prospective Carbones Pizzeria franchisee, this means it's crucial to budget carefully and ensure that Advertising Fees are paid on time to avoid these interest charges. Franchisees should also be aware of their state's laws regarding maximum interest rates, as this could affect the actual amount charged on late payments. Understanding these financial obligations is a key part of managing a successful Carbones Pizzeria franchise.