What triggers the Belocal Transfer 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 Transfer Damages fee is incurred if a franchisee fails to comply with the transfer terms outlined in the Franchise Agreement. This fee is designed to compensate Belocal if a franchisee attempts to transfer their business in a way that violates the agreement's stipulations.
The Transfer Damages fee is the greater of 15% of the transfer price or $25,000. This amount is due within 15 days of Belocal's demand. The fee aims to protect Belocal's interests by ensuring that all franchise transfers adhere to the established terms and conditions, maintaining brand consistency and operational standards.
For a prospective Belocal franchisee, it's crucial to thoroughly understand the transfer terms within the Franchise Agreement to avoid triggering this potentially significant fee. Franchisees should seek legal counsel to fully grasp their obligations and ensure compliance during any transfer process. Paying close attention to these terms can help franchisees avoid unexpected costs and maintain a positive relationship with Belocal.