What actions must a Churchs Chicken franchisee take in connection with payment of the Royalty Fee, advertising contributions and other amounts owed by electronic funds transfer?

According to Churchs Chicken's 2025 Franchise Disclosure Document, franchisees are required to participate in an electronic funds transfer program that authorizes Churchs Chicken to utilize a pre-authorized bank draft system for payments. This system is used for the royalty fee, advertising contributions, and any other amounts owed under the Franchise Agreement. These payments must be received or credited to Churchs Chicken’s account by pre-authorized bank debit before 5:00 p.m. on the 5th business day after the end of each fiscal week, referred to as the "Due Date."

On each Due Date, Churchs Chicken will transfer the reported or determined amount from the franchisee's commercial bank operating account. If a franchisee fails to report gross sales, Churchs Chicken can estimate the gross sales and transfer an amount based on that estimate. If Churchs Chicken determines that a franchisee has underreported gross sales or underpaid any amounts, it can initiate an immediate transfer from the franchisee's account for the appropriate amount. Any overpayment will be credited to the franchisee's account on the first reporting date after the credit is determined.

To facilitate these electronic funds transfers, a Churchs Chicken franchisee must comply with procedures specified in the Manual or in writing, perform necessary actions, and sign and deliver required documents. The franchisee must also provide Churchs Chicken with authorization to initiate debit entries and/or credit correction entries to their account for payments. It is the franchisee's responsibility to ensure sufficient funds are available in the account for withdrawal by electronic funds transfer no later than the Due Date. Failure to maintain sufficient funds constitutes a default of the Franchise Agreement.