How are liquidated damages calculated for Bonchon if the customer terminates after installation?
Bonchon Franchise · 2025 FDDAnswer from 2025 FDD Document
s abusive to or harassing WIN representatives and fails to stop such behavior after receiving a written or verbal warning. After termination due to breach, WIN may restore Service if Customer corrects any breach and pays all outstanding amounts owed, including restoration charges. In addition to these termination rights, if WIN determines that providing Services is not economically or technically feasible or because underlying facilities leased from third parties are no longer available to WIN due to legal/regulatory changes, WIN has the right to terminate this Agreement either prior to installation or on sixty (60) days' notice after installation.
11. Effect of Termination.
- Pre-Installation- If Customer terminates this Agreement due to any reason other than WIN's material breach or if WIN terminates this Agreement due to Customer's material breach after the Effective Date but prior to the installation of Service(s), Customer will pay WIN a Pre-Installation Cancellation Charge ("Can
Source: Item 23 — RECEIPTS (FDD pages 92–536)
What This Means (2025 FDD)
According to Bonchon's 2025 Franchise Disclosure Document, the calculation of liquidated damages after installation pertains to the agreement between WIN (a service provider) and the customer, not directly to the Bonchon franchisee's agreement with Bonchon. If a customer terminates the agreement with WIN after installation, the customer will pay WIN liquidated damages. These damages are equal to 100% of the Monthly Recurring Charges (MRCs) applicable to the terminated services, multiplied by the number of months remaining in the current term or renewal term.
If WIN's costs to other providers exceed this amount, the customer is also responsible for reimbursing WIN for these additional costs. In cases of partial cancellation where a Minimum Monthly Fee (MMF) applies, the customer will continue to be billed the MMF as liquidated damages. The agreement specifies that these liquidated damages are not considered a penalty but rather a fair estimate of the damages WIN may incur.
This clause is designed to compensate WIN for the losses they would experience due to the premature termination of the service agreement. It also acknowledges that determining actual damages can be difficult, hence the use of a liquidated damages clause. This arrangement protects WIN's financial interests by ensuring they receive compensation for the remaining term of the agreement, even if the customer terminates early. Bonchon franchisees should understand these terms as they relate to third-party service agreements necessary for their business operations.