What is the late fee for overdue payments to Engineering For Kids?
Engineering_For_Kids Franchise · 2025 FDDAnswer from 2025 FDD Document
to you and for other maintenance and | | Type of Fee (note 1) | Amount | Due Date | Remarks | |-------------------------------|-------------------------------------------------------------------------------------------------------------------------------------------|-------------------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------| | | | | support services that we or a third party might provide in the future. | | Audit (note 5) | Our costs and expenses of audit (including reasonable accounting and attorneys' fees), plus interest on underpayment | Upon demand | Payable only if audit by us shows that you understated Gross Revenues by at least 2%. | | Late Fee/Interest (note 6) | Greater of either a $25 late fee, or 1.5% per month interest on overdue amounts (but it will not be more than the maximum amount or rate allowed by law) | Upon demand | Applies only to late payment or report of Royalty fees and any other payments. Only due if you don't pay us the amounts you owe on time or submit reports on time.
Source: Item 6 — OTHER FEES (FDD pages 10–15)
What This Means (2025 FDD)
According to Engineering For Kids' 2025 Franchise Disclosure Document, if a franchisee fails to make payments or submit reports on time, they will incur a late fee. This fee is the greater of $25 or 1.5% per month interest on the overdue amount. However, the interest rate will not exceed the maximum amount or rate allowed by law. The late fee applies to overdue royalty fees and any other payments owed to Engineering For Kids. Interest starts accruing from the original due date of the payment.
This policy is fairly standard in franchising, as franchisors need to ensure timely payments to maintain their own financial stability and support services for all franchisees. The $25 minimum provides a baseline charge, while the 1.5% interest ensures that larger overdue amounts are appropriately addressed. Franchisees should be aware of these terms to avoid unnecessary charges and maintain a good financial standing with Engineering For Kids.
Engineering For Kids also retains the right to apply any payments received from the franchisee to any past due debts, in whatever amounts and order they deem appropriate. This means that if a franchisee has multiple outstanding debts, Engineering For Kids can decide how to allocate the payment, potentially prioritizing older debts or those with higher interest rates. Franchisees need to maintain organized records of their payments and outstanding balances to avoid confusion or disputes regarding payment allocation.