When are Liquidated Damages due to Christies International Real Estate?
Christies_International_Real_Estate Franchise · 2025 FDDAnswer from 2025 FDD Document
OTHER FEES**
| Fee (Note 1) | Amount (Note 2) | Due Date | Remarks |
|---|---|---|---|
| Royalty Fee | 3% to 6% of Gross Revenues, depending on whether your Protected Territory is exclusive and other factors | Monthly | Paid via Electronic Funds Transfer (EFT). You and we will negotiate your Royalty Fee, which will vary based on whether your Protected Territory is exclusive and other factors. It will range between 3% and 6%. |
| Advertising Fund Fee | Currently not collected | If collected, monthly with the Royalty Fee | We do not currently have an Advertising Fund. If implemented, the Advertising Fund Fee will not exceed 3% of Gross Revenues. |
| Additional Training, Training, Designated Programming | Currently, not collected, but the expected range would be between $200 to $3,000, per person per day | Upon demand | (Note 3) |
| Additional Training | Currently, $500 per attendee per day | Upon demand | |
| Annual Conference Fee | Currently, the expected range would be $1,500 to $3,500 per person | Before attending the Annual Conference | |
| Transfer Fee | $5,000 | Before you complete the transfer | Subject to state law, you pay the transfer fee when the License Agreement, the Business, or a material interest in you is transferred. You do not pay the transfer fee if the transferee is an entity controlled by you. |
| Renewal Fee | $1,000 | Upon notice of intent to renew | |
| Audit Fee | Cost of Audit | When incurred | Payable if audit discloses an under reporting of Gross Revenues or underpayment to us by 5% or more. |
| Insurance | Actual amount incurred | Upon demand | If you fail to purchase the insurance policies required under the License Agreement, we may purchase them on your behalf, and you will reimburse us. |
| Fee | Amount | Due Date | Remarks |
| (Note | (Note | ||
| 1) | 2) | ||
| Liquidated Damages | An amount equal to the average of the Royalty Fees payable by you over the previous 12 months (or the annualized amount of Royalty Fees if your Business has not been open for at least 12 months) and multiplied by the lesser of 24 or the number of months remaining on the term of the License Agreement | When the License Agreement is terminated prior to the end of the initial term | This is not a penalty but is an attempt to calculate of our damages for lost future revenue resulting from your breach or termination of the License Agreement. |
| Interest | Lessor of 1.5% per month or the maximum permitted by law | Owed on past due amounts | |
| Tax indemnity | Actual amount incurred | Upon demand | If required by the federal, state or locality in which your Business is located. Including sales, excise or gross receipts tax or similar type tax on the initial fee, royalty, and other fees and costs. |
| Step-In Management Fee | Currently $500 per day plus costs and expenses | Upon demand | In the event of your death or incapacity, we are entitled to a per diem amount, currently $500 per day, plus reimbursement for any reasonable expenses we incur in managing your Business. |
| Digital Campaigns | Your pro-rata share of the cost | At time of expense | We may negotiate contracts with vendors such as realtor.com, Zillow, Trulia, and Google AdWords. If you choose to participate, you must pay your pro-rata share either directly to the vendor or reimburse us. |
| Indemnity | Actual loss sustained | Upon demand | You must indemnify us from any loss arising directly or indirectly from the License Agreement, your operation of the Business, our relationship, your and/or your employees' actions or inactions, any claim that we are a joint employer with you for any reason, your activities under the License Agreement, and/or your breach of the License Agreement, etc. |
| Attorney Fees and Costs | Actual amount incurred | Upon demand | If we are the prevailing party in litigation with you, you agree to pay our costs and attorney fees in any action brought to enforce any provision of the License Agreement or to enjoin any violation of the License Agreement. |
| Fee | Amount | Due Date | Remarks |
| (Note | (Note | ||
| 1) | 2) | ||
| Late Payment Fee | $100 for each failure to pay each fee on time, and interest on the overdue amount at the rate of 1.5% per month (or the maximum rate permitted by applicable law, if less than 1.5%) from the date such amount was due until paid in full | Upon demand | |
| MLS Fee | $5,000 to $10,000 | Upon Demand | If you add additional MLS feeds to your account, you will be responsible to pay the MLS set up fee. |
| DMS Fee | $150 per agent | Annually | If you are using our proprietary software, there is an annual charge of $125 per agent for the Deal Management System for access to all MLS forms and |
Source: Item 6 — OTHER FEES (FDD pages 14–17)
What This Means (2025 FDD)
According to Christies International Real Estate's 2025 Franchise Disclosure Document, liquidated damages are due when the License Agreement is terminated prior to the end of its initial term. The amount of these damages is calculated based on the average of the royalty fees payable by the franchisee over the previous 12 months. If the business has not been open for at least 12 months, the damages will be based on the annualized amount of royalty fees. This amount is then multiplied by the lesser of 24 or the number of months remaining on the term of the License Agreement.
For a prospective Christies International Real Estate franchisee, this means that terminating the agreement early can result in a significant financial obligation. The liquidated damages are designed to compensate Christies International Real Estate for lost future revenue resulting from the termination. The calculation method ensures that the damages are proportional to the franchisee's past performance and the remaining term of the agreement.
It is important to note that Christies International Real Estate states that this is not a penalty but an attempt to calculate their damages for lost future revenue. Franchisees should carefully consider the implications of this clause before signing the License Agreement, as early termination can lead to substantial costs. Understanding the factors that contribute to the calculation of liquidated damages, such as royalty fees and the length of the agreement, is crucial for making an informed decision.