Under what circumstances does Christian Brothers Automotive charge liquidated damages?
Christian_Brothers_Automotive Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Fee (Note 1) | Amount | Due Date | Remarks |
|---|---|---|---|
| Liquidated Damages | An amount equal to the average of the monthly Royalty Fees paid (or payable) over the past 12 months times the lesser of 48 months or the number of full calendar months remaining in the term of the Franchise Agreement at the time of termination. | Upon demand at time of termination of your Franchise Agreement. | Payable if we terminate your Franchise Agreement for violation of your confidentiality or non compete obligations. See Section 15.09 of the Franchise Agreement. |
Source: Item 6 — OTHER FEES (FDD pages 17–25)
What This Means (2025 FDD)
According to Christian Brothers Automotive's 2025 Franchise Disclosure Document, liquidated damages are payable if Christian Brothers Automotive terminates the Franchise Agreement due to a franchisee's violation of confidentiality or non-compete obligations. The specific section of the Franchise Agreement outlining these terms is Section 15.09.
The amount of liquidated damages is calculated based on the average of the monthly Royalty Fees paid (or payable) over the past 12 months. This average is then multiplied by the lesser of 48 months or the number of full calendar months remaining in the term of the Franchise Agreement at the time of termination. This calculation determines the total amount the franchisee must pay.
This fee is due upon demand at the time of termination of the Franchise Agreement. This means that if Christian Brothers Automotive terminates the agreement for the reasons specified, the franchisee will be required to immediately pay the calculated liquidated damages amount. Prospective franchisees should carefully review Section 15.09 of the Franchise Agreement to fully understand the circumstances that could lead to the assessment of liquidated damages and the potential financial implications.