Under what circumstances will a Bonchon customer be charged a Pre-Installation Cancellation Charge?
Bonchon Franchise · 2025 FDDAnswer from 2025 FDD Document
Customer agrees that the Cancellation Charge is a reasonable measure of the administrative costs and other fees incurred by WIN to prepare for installation.
The Cancellation Charge set forth in this Section is in lieu of the charges set forth in 11(b).
Post-Installation- IF CUSTOMER TERMINATES THIS AGREEMENT OR PART OR ALL SERVICES PROVIDED HEREUNDER AFTER INSTALLATION DURING THE INITIAL OR RENEWAL TERM FOR ANY REASON OTHER THAN FOR WIN'S MATERIAL BREACH OR IF WIN TERMINATES THIS AGREEMENT DUE TO CUSTOMER'S MATERIAL BREACH, CUSTOMER SHALL PAY TO WIN AS LIQUIDATED DAMAGES, AND NOT AS A PENALTY, AN AMOUNT EQUAL TO ONE HUNDRED PERCENT (100%) OF THE MRCS APPLICABLE TO THE SERVICES THAT WERE TERMINATED MULTIPLIED BY THE NUMBER OF MONTHS REMAINING IN THE THEN-CURRENT TERM OR RENEWAL TERM.
IF WIN'S COSTS TO OTHER PROVIDERS ARE GREATER THAN THIS AMOUNT, CUSTOMER SHALL ALSO REIMBURSE WIN FOR SUCH ADDITIONAL COSTS.
IF THE CUSTOMER PARTIALLY CANCELS AND HAS A MINIMUM MONTHLY FEE ("MMF"), THEN THE CUSTOMER SHALL CONTINUE TO BE BILLED THE MMF ("LIQUIDATED DAMAGES").
CUSTOMER ACKNOWLEDGES THAT ACTUAL DAMAGES WOULD BE DIFFICULT TO DETERMINE AND SUCH LIQUIDATED DAMAGES REPRESENT A FAIR AND REASONABLE ESTIMATE OF THE DAMAGES WHICH MAY BE INCURRED BY WIN.
Limitation of Liability; Indemnity.
FOR PURPOSES OF SECTIONS 12 AND 13, "WIN" INCLUDES ITS OFFICERS, DIRECTORS, SHAREHOLDERS, EMPLOYEES, AGENTS, SUBCONTRACTORS, VENDORS, AND ANY ENTITY ON WHICH BEHALF WIN RESELLS SERVICES.
EXCEPT FOR WILLFUL MISCONDUCT, WIN'S LIABILITY FOR SERVICES AND INSTALLATION WILL NOT EXCEED CUSTOMER'S MRCS DURING THE PERIOD IN WHICH THE DAMAGE OCCURS.
Source: Item 23 — RECEIPTS (FDD pages 92–536)
What This Means (2025 FDD)
According to the 2025 Bonchon FDD, a customer may be charged a Cancellation Charge to cover the administrative costs and fees incurred to prepare for installation. The FDD states that this charge is considered a reasonable measure of these costs. This Cancellation Charge is applied instead of the charges outlined in section 11(b) of the agreement.
If a customer terminates the agreement or any services after installation, but not due to Bonchon's (WIN's) material breach, or if Bonchon terminates the agreement due to the customer's material breach, the customer must pay liquidated damages. These damages are equal to 100% of the monthly recurring charges (MRCs) for the terminated services, multiplied by the number of months remaining in the current term. If Bonchon's costs to other providers exceed this amount, the customer is also responsible for reimbursing Bonchon for these additional costs.
If a customer partially cancels services and has a minimum monthly fee (MMF), they will continue to be billed the MMF as liquidated damages. The FDD emphasizes that actual damages would be difficult to determine, and these liquidated damages represent a fair and reasonable estimate of the damages Bonchon may incur. The liability of Bonchon (WIN) for services and installation will not exceed the customer's MRCs during the period in which the damage occurs, except in cases of willful misconduct.