What is the maximum aggregate liability of Brain Balance to the licensee for claims related to the agreement?

According to Brain Balance's 2025 Franchise Disclosure Document, the franchisor's aggregate liability to the franchisee arising from any claim or circumstance relating to the agreement is limited. This includes breaches of obligations relating to the quality or performance of the software, software materials, and/or the hosting services. The limit is set to the amount of fees paid by the franchisee to Brain Balance under the agreement for the twelve months immediately preceding the event that led to the liability.

This means that a Brain Balance franchisee's potential recovery from the franchisor for any claim related to the franchise agreement is capped. The cap is calculated based on the franchise fees paid in the year before the event that caused the claim. This could be a significant limitation, especially if the franchisee has suffered substantial damages exceeding the amount of fees paid during that period.

This type of limitation of liability clause is relatively common in franchise agreements. It serves to protect the franchisor from potentially large payouts that could arise from various claims. Prospective franchisees should carefully consider this limitation and assess whether the potential risks associated with the franchise are adequately mitigated, given this financial constraint on Brain Balance's liability. It would be prudent to consult with a legal professional to fully understand the implications of this clause.