Under what conditions will Epcon Communities provide a partial release of the mortgage?
Epcon_Communities Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Article or Section in Mortgage | Summary |
|---|---|---|
| d. Termination by franchisee | Paragraph E (1) and (2) | We will terminate the mortgage entirely upon payment of all sums secured by the Mortgage and performance of all of obligations under the Mortgage. We will provide partial release of mortgage upon payment of applicable percent of sales price of each Unit. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION THE FRANCHISE RELATIONSHIP (FDD pages 55–69)
What This Means (2025 FDD)
According to Epcon Communities' 2025 Franchise Disclosure Document, a partial release of the mortgage is provided when the franchisee makes a payment equal to the applicable percentage of the sales price for each unit. This condition is outlined in Paragraph E (1) and (2) of the mortgage agreement, as referenced in Item 17.
This means that as an Epcon Communities franchisee develops and sells individual units within a project, a portion of the mortgage can be released for each unit sold. The specific percentage of the sales price required for the partial release is not detailed in this excerpt but is a critical factor for franchisees to understand. This mechanism allows the franchisee to reduce their overall mortgage liability as they generate revenue from unit sales.
Prospective franchisees should clarify the 'applicable percent of sales price' with Epcon Communities to fully understand the financial implications. Understanding this percentage is crucial for projecting cash flow, managing debt, and determining the profitability of each project. It is also important to understand how this process integrates with the overall project financing and sales strategy.