Termination
Franchise Agreements list a number of circumstances in which the Agreement may be terminated prematurely. These include:
Bankruptcy, company liquidation or criminal conviction of the franchisee
Termination of leases to the franchise premises (where premises retention is important).
Termination provisions should be looked at very carefully as they are often points of contention. There are frequent misunderstandings by franchisees as to what happens at the end of a term and practices vary from one franchise system to another.
However, it should also be borne in mind that if the franchise is operating well and the franchise relationship is a good one, it is likely that both franchisee and franchisor will want to renew the Agreement.