Franchise Law

Jonathan d. cran, p.a.

ATTORNEY AT LAW

Franchise Law

Franchising is an important component of the U.S. economy and a growing factor in international business. When franchising succeeds, the results can be impressive. Everyone knows the names of franchise systems in the sectors of fast food, hotels, auto services, education, real estate brokerages, business services, health clubs and many more.

Franchising is a method of financing as well as a means of distribution. A franchisor can replicate its business many times over through the investment of franchisees in their own businesses. The franchisor can do this without diluting the ownership of the franchisor company.

From the franchisee's point of view, franchising offers the opportunity to own a business following a proven format while becoming part of a larger system that often provides instant market acceptance. An entrepreneurial-minded individual franchisee has greater control over the business than an employee. Multi-unit franchising offers growth potential for franchisees, whose exit strategies include selling the business or going public.

Jonathan D. Cran, P.A. represents both franchisors and franchisees. We assist U.S. firms to expand by establishing new franchise businesses or acquiring franchise companies. We represent entrepreneurs in the purchase or sale of franchises. When appropriate, we also help companies to establish distribution and licensing systems that are not franchises, and we advise companies whose businesses may inadvertently fall within the scope of the franchise laws. Finally, we assist both franchisors and franchisees in resolving franchise disputes.

We have extensive experience representing multi-unit operators in the franchise area. We have represented operators (from one location to 150 locations) of most of the national franchise brands in the quick-serve industry (e.g. Taco Bell, Pizza Hut, Burger King, Culvers, Subway, Blimpies). We have also represented operators in the casual dining market, the dry-cleaning market and the automotive service market. We can help you with your franchise documents, entity formation and financing.

We also represent franchisors, and therefore have a unique perspective that can benefit our clients, whether they are franchisees or franchisors.

Franchisors

We handle the franchise registration process throughout the U.S. in those states that require registration, and we counsel clients on what they must do to comply with the franchise laws. In addition to drafting franchise documents and advising on franchise law compliance, we assist franchisors in protecting their trademarks, setting up or maintaining their corporations, limited liability companies or other entities, lease negotiations, negotiating contracts with suppliers and dispute resolution.

We help franchisors comply with federal and state franchise laws. This help includes drafting:

* Franchise Disclosure Documents

* Franchise Agreements

* Area Development Agreements

* Other Related Documents

Commencing July 1, 2008, all franchisors will be required to follow the new amended Federal Trade Commission Franchise rule. Accordingly, all franchise documents must be brought into compliance with the amended rule during the 2008 renewal process, and new franchisors should follow the amended rule when preparing their franchise documents. We are knowledgeable regarding the new amended rule and can assist franchisors in complying with the amended rule going forward.

Franchisees

We assist franchisees in the review of franchise offerings and the negotiation of franchise agreements. Despite anything you may have heard to the contrary, franchise agreements are negotiable. While franchisors are unlikely to modify basic aspects of the franchise relationship, many franchisors will agree to modifications to resolve a specific franchisee's issues or to clarify ambiguous provisions in a franchise agreement. Issues specific to a franchisee might relate, for example, to the scope of exclusivity, the right to transfer the franchise or the timing requirements for development.

In addition to reviewing, advising and negotiating franchise offerings for prospective franchisees, we can structure and establish the corporation or other entity that will be the franchisee, review and negotiate the business location lease, and assist the franchisee if disputes arise.

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