What is the condition for the Buff City Soap developer to pay liquidated damages in a lump sum?
Buff_City_Soap Franchise · 2025 FDDAnswer from 2025 FDD Document
Section 21(a) of the Area Development Agreement is hereby deleted in its entirety and replaced with the following: "(a) Payment of Amounts Owed.
Developer will pay to Franchisor within 15 days after the effective date of expiration or termination of this Agreement, or on such later date that the amounts due are determined, such fees, interest due on any of the foregoing and all other amounts owed to Franchisor or its Affiliates under this Agreement which are then unpaid.
If this Agreement is terminated by Franchisor following the occurrence of an Event of Default and Developer's failure to cure within any applicable cure period, or if Developer delivers Notice of termination of this Agreement to Franchisor other
Source: Item 6 — , Securities Offering Fee, in the amount column is revised to state the following: (FDD pages 216–303)
What This Means (2025 FDD)
According to the 2025 Buff City Soap FDD, a developer is required to pay all outstanding amounts to Buff City Soap within 15 days of the termination or expiration of the Area Development Agreement. This includes fees, interest on any outstanding amounts, and all other debts owed to Buff City Soap or its affiliates under the agreement.
However, if the Area Development Agreement is terminated by Buff City Soap due to the developer's failure to address an Event of Default within the given cure period, or if the developer notifies Buff City Soap of their intent to terminate the agreement, the developer may be subject to additional financial obligations. This could potentially include liquidated damages, though the specific conditions for these damages are not detailed in this excerpt.
It is important for prospective Buff City Soap developers to understand the conditions under which they might owe additional payments beyond the standard fees and interest. They should carefully review the Area Development Agreement to fully understand the circumstances that could lead to the assessment of liquidated damages and the methods for calculating those damages.