Can Potbelly Sandwich Works auto debit interest charges from my account?
Potbelly_Sandwich_Works Franchise · 2025 FDDAnswer from 2025 FDD Document
| Column 1 | Column 2 | Column 3 | Column 4 |
|---|---|---|---|
| Type of fee1 | Amount | Due Date | Remarks |
| Audit | Cost of inspection or audit (amount of which depends on circumstances and extent of your non compliance) | 15 days after billing | Due if you do not give us reports, supporting records, or other required information or understate required Royalties or other amounts by more than 2%. |
| Late Fee | $100 | May be auto debited from your account | Due for each late or dishonored payment. |
| Interest | Lesser of 1.5% per month or highest commercial contract interest rate law allows | May be auto debited from your account | Due on all overdue amounts more than 7 days late. |
| Non-Approved Shop Opening | $5,000 for each day your Shop operates without our approval | May be auto debited from your account | Due if you begin operating Shop before we give our approval. |
| Management Fee | Manager's then-current daily salary plus direct expenses | As incurred | Due when we (or a third party) manage Shop after Managing Owner's death or disability or after your default or abandonment. |
| Costs and Attorneys' Fees | Will vary under circumstances and depend on nature of your non-compliance | As incurred | Due when we incur costs and expenses to enforce Franchise Agreement against you, whether or not we begin formal legal proceeding. |
Source: Item 6 — OTHER FEES (FDD pages 17–24)
What This Means (2025 FDD)
According to Potbelly Sandwich Works's 2025 Franchise Disclosure Document, Potbelly Sandwich Works can auto debit interest charges from a franchisee's account. The interest is due on all overdue amounts that are more than 7 days late. The interest charged will be the lesser of 1.5% per month or the highest commercial contract interest rate the law allows.
In addition to interest, Potbelly Sandwich Works can also auto debit a franchisee's account for late fees and non-approved shop opening fees. The late fee is $100 for each late or dishonored payment. The non-approved shop opening fee is $5,000 for each day the shop operates without approval from Potbelly Sandwich Works.
Before a Potbelly Sandwich Works shop opens, a franchisee must sign documents that authorize Potbelly Sandwich Works to debit their business checking or other bank account automatically for the Royalty, Brand Fund contributions, and other amounts due under the Franchise Agreement or in connection with the Shop's operation. This includes amounts due for purchases of Potbelly Trade Secret Products, Potbelly Branded Products, other items, and services from Potbelly Sandwich Works, their affiliates and/or unaffiliated vendors.