What fees are included in the calculation of liquidated damages for a Bigfoot Forestry franchise?
Bigfoot_Forestry Franchise · 2025 FDDAnswer from 2025 FDD Document
- Liquidated Damages: You must pay us liquidated damages if: (a) we terminate the Franchise Agreement due to your default; or (b) you terminate the Franchise Agreement prior to its expiration date (except in accordance with the provisions governing your right to terminate following our uncured breach). Liquidated damages are calculated as the sum of average monthly royalty fees and brand fund fees imposed during the 12-month period preceding termination (or your entire period of operation if less than 12-months) multiplied by the lesser of: (a) 24 (representing 2 years' of fees); or (b) the total number of months remaining under the term. If you pay us liquidated damages in a timely manner, we may not pursue a claim against you for lost profits (but we may still seek other damages we incur due to your breach).
Source: Item 6 — OTHER FEES (FDD pages 12–15)
What This Means (2025 FDD)
According to the 2025 Bigfoot Forestry Franchise Disclosure Document, liquidated damages are calculated if the Franchise Agreement is terminated either by Bigfoot Forestry due to the franchisee's default, or by the franchisee before the agreement's expiration (except in specific breach scenarios). The liquidated damages consist of the sum of the average monthly royalty fees and brand fund fees. These fees are those imposed during the 12-month period preceding the termination date. If the franchise operated for less than 12 months, the calculation uses the entire period of operation.
The sum of the average monthly royalty fees and brand fund fees is then multiplied by a factor. This factor is the lesser of two numbers: either 24 (representing two years' worth of fees) or the total number of months remaining under the franchise term. This calculation determines the total liquidated damages the franchisee must pay to Bigfoot Forestry.
If the franchisee pays the liquidated damages in a timely manner, Bigfoot Forestry agrees not to pursue further claims for lost profits. However, Bigfoot Forestry retains the right to seek other damages incurred due to the franchisee's breach of the agreement. This provision offers some protection to the franchisee by limiting the scope of potential financial liabilities upon early termination or default, provided the liquidated damages are paid as required.