What is the annual interest rate charged on overdue amounts for a Casiola franchise?
Casiola Franchise · 2024 FDDAnswer from 2024 FDD Document
| Reporting Non-Compliance | $150 per occurrence | 14 days of invoice | Payable for failure to timely submit Royalty and Activity Reports, and other reports and financial statements as required under Franchise Agreement. |
| Operations Non-Compliance | $500 to $1,000 per occurrence | 14 days of invoice | Payable for failure to comply with operational standards as required under Franchise Agreement, plus inspection and re-inspection costs incurred by us. |
| Payment Non-Compliance | $150 per occurrence | 14 days of invoice | Payable for failure to timely pay, when due, a fee or payment due to us under the Franchise Agreement, plus interest, costs and legal fees. |
| Interest | 18% per annum from due date | On demand | Payable on all overdue amounts, fees, charges, and payments due to us under the Franchise Agreement. Interest rate cannot exceed legal rate allowed by law and may be adjusted to reflect same. |
Source: Item 6 — OTHER FEES (FDD pages 12–18)
What This Means (2024 FDD)
According to Casiola's 2024 Franchise Disclosure Document, overdue amounts, fees, charges, and payments due to Casiola under the Franchise Agreement will incur an interest rate of 18% per annum from the due date. This interest is payable on demand.
This means that if a Casiola franchisee fails to make timely payments for any fees or amounts owed to Casiola, they will be charged interest on the outstanding balance. The 18% annual interest rate could significantly increase the amount owed over time, making it crucial for franchisees to manage their finances carefully and ensure timely payments.
However, the interest rate cannot exceed the legal rate allowed by law and may be adjusted to reflect the same. This clause protects the franchisee from excessively high interest rates that may be illegal in their jurisdiction. Prospective franchisees should be aware of this potential additional cost and factor it into their financial planning.