Ten legal issues to consider in structuring a refranchising programme

Abstract

This paper is intended to familiarise the reader with significant issues which need to be addressed in the context of selling retail units to purchasers who will subsequently become franchisees of the seller. This process, called ‘refranchising’, is especially relevant in the restaurant, hotel and retail industries where franchising is most prevalent. The paper addresses a process which is typically followed from letter of intent through due diligence and the execution of closing of the transaction documents: purchase agreement, franchise agreement and development agreement. The paper also discusses drafting concerns affecting both the letter of intent and the relevant transaction documents. [ABSTRACT FROM AUTHOR]