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Log In / Register | Mar 26, 2017
Bob Frankman's picture

Legal horror stories?

John,

I'm interested in your top 10 legal tips slides and will email you shortly. However, to get the discussion going, could you put a few bullet points of tips to consider?

I don't mean to be morbid but I'm curious just how wrong it can get when some of these points are ignored. Any horror stories?

I'll add one point and I'm not even on your payroll. Check the fine print of the Franchise Agreement with a qualified lawyer. It seems to me that one of the problems potential franchisees overlook (at least I did) has to be not understanding how difficult it is for the franchise to leave the system while it is quite easy for a typical franchiser to terminate the franchise agreement. Such as:

* If you cannot meet financial benchmarks, one can be terminated.
* If you do not meet and rectify operational standards -- you can be terminated.

And not only can a franchiser terminate fairly easily. They can make life difficult and set up another store right down the street through loopholes in the territory clause.

Any thoughts on this?

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