Does Belocal specify the method of payment for the Wind-Down Damages fee?
Belocal Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Fee(1) | Amount | Due Date | Remarks |
|---|---|---|---|
| Management Fee | 45% of monthly Cash Received, plus any expenses we incur in managing the Franchised Business | Monthly | Only payable in the event we must operate your franchise due to death, disability, defaults etc. The Management Fee is in addition to other fees due to us. |
| Customer Complaint Fee | Our costs and expenses associated with our response to and any resolution of a complaint | On demand | If an advertiser, client, or third party complains to us and you fail to satisfactorily remedy the complaint, you will pay us our costs and expenses associated with our response to and any resolution of the complaint. |
| Wind-Down Damages | An amount equal to the greater of (a) 6 months' worth of the average Royalty you paid for the 12 months prior to the default or (b) $2,500 | On demand | Only payable if you fail to comply with the wind-down procedures or abandon the Franchised Business. |
| Transfer Damages | Greater of 15% of transfer price or $25,000 | Within 15 days of our demand | You will pay these transfer damages if you do not comply with the transfer terms under the Franchise Agreement. |
Source: Item 6 — OTHER FEES (FDD pages 14–31)
What This Means (2025 FDD)
According to Belocal's 2025 Franchise Disclosure Document, the method of payment for the Wind-Down Damages fee is not specified. The FDD does, however, outline the amount and due date for this fee. The Wind-Down Damages fee is an amount equal to the greater of (a) 6 months’ worth of the average Royalty you paid for the 12 months prior to the default or (b) $2,500.
The Wind-Down Damages are only payable if a franchisee fails to comply with the wind-down procedures or abandons the franchised business. This fee is due 'on demand,' meaning Belocal can request immediate payment if the conditions for the fee are met.
Since the FDD does not specify the acceptable methods of payment for the Wind-Down Damages fee, it would be prudent for a prospective franchisee to discuss this with Belocal. Understanding the accepted payment methods can help in financial planning and ensure compliance with the franchise agreement.