What is the maximum interest rate a Chicken Guy franchisee may be charged on past due amounts?

According to Chicken Guy's 2025 Franchise Disclosure Document, if a franchisee fails to make payments by the due date, Chicken Guy will charge interest on the past due amount. This interest accrues from the date the payment was originally due until it is paid in full. The interest rate will be the maximum rate permitted for this type of debt under the laws of the state where the franchised restaurant is located. However, the interest rate will not exceed 1.5% per month, or a portion of a month.

For a prospective Chicken Guy franchisee, this means that late payments can result in significant additional costs. It is important to ensure timely payments to avoid these interest charges, which can quickly add up, especially if the outstanding balance is substantial. The franchisee agreement specifies that failure to maintain sufficient funds for electronic transfers constitutes a default, further emphasizing the importance of managing finances carefully.

This interest charge is in addition to any other legal remedies Chicken Guy may pursue for the franchisee's failure to pay. Furthermore, any partial payments made by the franchisee will be applied at Chicken Guy's discretion to any outstanding debts, including royalty fees, advertising contributions, or interest charges. This ensures that Chicken Guy retains control over how payments are allocated, prioritizing the collection of overdue amounts.