Under what circumstances are notes receivable issued by Chem Dry?

According to Chem Dry's 2024 Franchise Disclosure Document, a "Business Note" is issued to represent the balance of the Initial Fee, Initial License Fee, or other amounts payable by the franchisee to Chem Dry under the Franchise Agreement. The franchisee's obligations under this note are absolute, irrevocable, and unconditional, meaning that any claims or disputes arising from the Franchise Agreement do not affect the franchisee's responsibility to pay the note as agreed. Chem Dry retains the right to assign, transfer, discount, or pledge the Business Note without notifying the franchisee. The franchisee's obligations under the Business Note are independent of any rights or obligations outlined in the Franchise Agreement.

The Business Note can be prepaid in whole or in part, without any premium, on any installment due date, with minimum partial payments of $100 or multiples thereof. If the franchisee pays the full Initial License Fee within six months of the Business Note's date, Chem Dry will discount the total due for the Initial License Fee by 10%. Prepayments do not affect the franchisee's obligation to make regular installment payments until the note is paid in full. All amounts due to Chem Dry are subject to a one-time late fee of $100, and overdue amounts accrue interest at the highest applicable legal rate for open account business credit in the franchisee's state of domicile, not exceeding 1.5% per month. After the note's maturity, interest accrues on the principal balance at a rate of 18% per annum. A $40 charge is assessed for each unpaid returned installment.

Upon default, Chem Dry can declare all obligations under the Business Note immediately due and payable. This means that if a Chem Dry franchisee fails to meet the payment terms of the Business Note, the entire outstanding balance becomes immediately due, and Chem Dry can take action to recover the full amount. This clause protects Chem Dry's financial interests and ensures that franchisees are held accountable for their financial commitments.