What payment methods are acceptable for Royalty Fees and advertising contributions for a Churchs Chicken franchise?
Churchs_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
ross Sales from the Franchised Restaurant during the preceding fiscal week and such other data or information as Cajun may require.
F. Payment of Fees.
- (1) Within 5 business days after the end of each fiscal week (as defined by Cajun from time to time), Franchisee shall pay to Cajun (by electronic funds transfer or by such other form or method as Cajun may designate) the Royalty Fee and advertising contributions applicable to Gross Sales for the Franchised Restaurant for the preceding fiscal week and any other amounts owed under this Agreement.
- (2) Franchisee shall participate in an electronic funds transfer program established by Cajun that authorizes Cajun to utilize a pre-authorized bank draft system. The Royalty Fee and advertising contributions calculated on the basis of Gross Sales and other amounts owed under this Agreement must be received by Cajun or credited to Cajun's account by pre-authorized bank debit before 5:00 p.m. on the 5th business day after the end of each fiscal week ("Due Date"). On each Due Date, Cajun will transfer from the Franchised Restaurant's commercial bank operating account ("Account") the amount reported to Cajun in Franchisee's remittance report or determined by Cajun by the records contained in the cash registers/computer terminals of the Franchised Restaurant. If Franchisee has not reported Gross Sales to Cajun for any fiscal period, Cajun may transfer from the Account an amount calculated in accordance with its estimate of the Gross Sales during the fiscal period. If, at any time, Cajun determines that Franchisee has underreported the Gross Sales of the Franchised Restaurant, or underpaid the Royalty Fee or other amounts due to Cajun under this Agreement or any other agreement, Cajun may initiate an immediate transfer from the Account in the appropriate amount in accordance with the foregoing procedure. Any overpayment will be credited to the Account effective as of the first reporting date after Cajun and Franchisee determine that such credit is due.
- (3) In connection with payment of the Royalty Fee, advertising contributions and other amounts owed under this Agreement by electronic funds transfer, Franchisee shall: (a) comply with procedures specified by Cajun in the Manual or otherwise in writing; (b) perform those acts and sign and deliver those documents as may be necessary to accomplish payment by electronic funds transfer as described in this Section 3.F.; (c) give Cajun an authorization in the form designated by Cajun to initiate debit entries and/or credit correction entries to the Account for payments of the Royalty Fee and other amounts payable under this Agreement;
Source: Item 23 — RECEIPT (FDD pages 68–406)
What This Means (2025 FDD)
According to the 2025 Churchs Chicken Franchise Disclosure Document, franchisees are required to participate in an electronic funds transfer program. This program authorizes Churchs Chicken to utilize a pre-authorized bank draft system for collecting royalty fees, advertising contributions, and other amounts owed under the Franchise Agreement. These payments, calculated based on Gross Sales, must be received or credited to Churchs Chicken’s account via pre-authorized bank debit by 5:00 p.m. on the 5th business day after the end of each fiscal week, which is considered the "Due Date".
On each Due Date, Churchs Chicken will transfer the reported amount from the franchisee's commercial bank operating account. If a franchisee fails to report Gross Sales, Churchs Chicken can estimate the sales and transfer an amount accordingly. Furthermore, if Churchs Chicken determines that a franchisee has underreported sales or underpaid fees, it can initiate an immediate transfer from the franchisee's account to cover the deficit. Any overpayment will be credited back to the franchisee’s account on the next reporting date after the discrepancy is acknowledged by both parties.
Franchisees must comply with Churchs Chicken's procedures for electronic funds transfers, which may be specified in the Manual or in writing. This includes providing the necessary authorization for Churchs Chicken to debit the franchisee's account for payments. Franchisees are also responsible for ensuring sufficient funds are available in their account by the payment Due Date. However, Churchs Chicken retains the right to modify the payment method for royalty fees, advertising contributions, and other amounts owed by providing notice to the franchisee.