What happens if a Belocal franchisee fails to comply with any provision of the franchise agreement?

• (11) Franchisee fails to comply with any other provision of this Agreement.

• G.

Step-In Rights.

In addition to Franchisor's right to terminate this Agreement, and not in lieu of such right, or any other rights Franchisor may have against Franchisee, upon a failure by Franchisee or any Principal to comply with any of the requirements of this Agreement, or upon a failure to cure any default within the applicable time period (if any), Franchisor shall have the right, but not the obligation, to assume management of the Franchised Business (or appoint a party to assume its management) until such time as Franchisor determines that the default has been cured and Franchisee is otherwise in compliance with this Agreement, or until Franchisor determines it will no longer exercise its step-in right.

Therefore, Franchisee and Franchisor agree that a reasonable estimate of those damages (as liquidated damages and not as a penalty) is an amount equal to the greater of six months' worth of the average Royalty Franchisee paid for the prior 12 months or $2,500 ("Wind-Down Damages").

Franchisor may terminate this Agreement immediately upon written notice to Franchisee, without an opportunity to cure, if:

• (1) Franchisee abandons or otherwise ceases operations of the Franchised Business contemplated by this Agreement;

• (2) Franchisee or any Principal transfers or attempts to transfer any interest in this Agreement, Franchisee, or the Franchised Business in violation of Section 9. of this Agreement;

• (3) Franchisee or any Principal uses the Copyrighted Materials or uses or discloses the Confidential Information in violation of this Agreement;

• (4) Franchisee or any Principal fails to comply with any of the covenants set forth in this Agreement, including those in Section 7.A to 7.D. relating to confidentiality and restrictions against unfair competition and solicitation;

• (5) Franchisee or any Principal misuses or makes any unauthorized use of the System or the Marks, or impairs the goodwill associated therewith or Franchisor's rights therein; or otherwise breaches the obligations set forth in Section 8;

If Franchisee abandons the Franchised Business prior to the effective date of termination established by Franchisor or fails to comply with the wind-down procedures in the Franchise Brand Standards Manual, Franchisee shall be in default under this Agreement and Franchisor shall have the right to immediately terminate this Agreement and charge the Wind-Down Damages.

• (1) Immediately cease to conduct operations of the Franchised Business and cease holding themselves out as a franchisee (or a principal of a franchisee) of Franchisor (except for purposes of disclosing past experience on a resume);
• (2) Promptly discontinue all use of the Marks, Copyrighted Materials, and Confidential Information and take appropriate action to return to Franchisor, or deliver to the transferee if Franchisor so designates, all Copyrighted Materials and Confidential Information in Franchisee's possession or within its control;
  • (3) Pay all amounts due under this Agreement;
• (5) Comply with the covenants set forth in Section 7.;
• (6) At Franchisor's option, assign to Franchisor, or if applicable, the transferee, all rights, control, and access to any business listings and Online Presences (including accounts, credentials, and login information) and telephone numbers (including personal cellphone numbers) related to or associated with the Franchised Business and execute all forms and documents required by Franchisor to transfer such items to Franchisor or, if applicable, the transferee. Franchisee agrees to use different telephone numbers, business listings, and Online Presences in connection with any subsequent business conducted by Franchisee. Franchisor has the right to prohibit Franchisee's continued control of, use of, or access to such Online Presences;

Source: Item 22 — CONTRACTS (FDD page 71)