Under what circumstances is N2 (Belocal) not liable to the franchisee for loss of revenue?

According to Belocal's 2025 Franchise Disclosure Document, N2 is not liable to the franchisee for any loss of revenue under any circumstances. N2 will not be liable to the franchisee or any third party for any loss of use, revenue, or profit, or loss of data or diminution in value, or for any consequential, incidental, indirect, exemplary, special, or punitive damages, whether arising out of breach of contract, tort (including negligence), or otherwise. This holds true regardless of whether such damage was foreseeable and whether N2 has been advised of the possibility of such damages, and notwithstanding the failure of any agreed or other remedy of its essential purpose.

Belocal's liability arising out of or related to the agreement, whether from breach of contract, tort, or otherwise, is capped at the aggregate amounts paid to N2 during the preceding 12-month period. This limitation of liability is a significant factor for prospective franchisees to consider. It means that even if Belocal's actions or omissions cause substantial financial harm to the franchisee's business, the franchisee's potential recovery from Belocal is limited to the fees they paid to Belocal in the previous year.

This type of clause is common in franchise agreements, but the specific terms can vary. Franchisees should carefully evaluate the potential risks and rewards of the franchise opportunity in light of these limitations. It is important to note that this limitation of liability does not cover instances of gross negligence or willful misconduct, which may be subject to different legal standards.