What is the due date for interest payments on overdue amounts to Cordova?
Cordova Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Fee (Note 1) | Amount | Due Date | |
|---|---|---|---|
| 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 11–15)
What This Means (2025 FDD)
According to Cordova's 2025 Franchise Disclosure Document, interest on overdue amounts, fees, charges, and payments is due 'on demand.' This means that Cordova can request payment of the accrued interest at any time after an amount becomes overdue. The interest rate is 18% per annum, but it will be adjusted if that rate exceeds the maximum legal rate allowed by law.
This 'on demand' payment schedule gives Cordova significant flexibility in managing its receivables. It also means that as a franchisee, you could face unpredictable demands for interest payments, making financial planning more challenging. It is critical to ensure all payments are made on time to avoid incurring interest charges and the potential for frequent 'on demand' payment requests.
Many franchisors charge interest on overdue amounts, but the specific interest rate and payment terms can vary. Some may have a fixed due date for interest payments (e.g., monthly or quarterly), while others, like Cordova, retain the right to demand payment at any time. Understanding these terms is essential for managing your cash flow and maintaining a positive relationship with Cordova.