California Business Law Attorney Assisting Clients with Franchise Purchases

Any entrepreneurs in California who are considering the possibility of buying a franchise should learn more about the franchising process and understand when it is necessary to have an experienced California business law and franchise lawyer to assist with the process.

In the early stages of considering a franchise, you do not necessarily need to rush out to find an attorney. Since you will not be taking any legal steps when you are investigating potential franchise options and learning more about what various franchises have to offer, you can conduct this kind of exploratory research on your own and with a flexible schedule.

However, once you make the decision to move forward on buying a franchise, it will be critical to have an experienced attorney on your side who can review the franchise disclosure document (FDD) and negotiate the terms of the franchise agreement.

Our experienced and dedicated team can help to ensure your franchise purchase results in terms that are favorable to you and that allow you to run a successful business. The following are legal services we provide that are essential when you are starting a franchise.

Franchise Disclosure Document Review

The franchise disclosure document, or FDD, is one of the first official documents you will receive from the franchisor when you are considering the possibility of buying a franchise. The FDD is not a document you will need to sign,  it is a document that gives information you will need about the business as you conduct due diligence. You should always have a California business lawyer review the FDD to identify any potential issues or red flags when it comes to moving forward with a franchise purchase.

Negotiation of Franchise Agreement Terms

Your California business attorney will be essential in negotiating the terms of the franchise agreement. This is the contract that will exist between you and the franchisor, and it outlines a wide variety of issues, from royalties to rights of first refusal for new franchises. While you may have heard that it is difficult or even impossible to negotiate the terms of a franchise agreement, this is a misconception. You can indeed negotiate the terms of a franchise agreement and may be able to negotiate some of the following, for example:

• Get more funding from the franchisor for marketing the business
• Obtain a right of first refusal for new franchises in your geographic region
• Make changes to the transfer fee or franchise fee
• Eliminate the franchisor’s right to certain royalties, and
• Revise the personal guarantee term lengths

Closing Process

Once all franchise agreement negotiations have concluded and we have drafted any necessary addenda to the agreement, we can work with you to move forward on the closing process. Depending upon whether you are opening a new franchise location or purchasing an existing location, it will be important to conduct a final review of all contracts and agreements before you sign to ensure that all the terms meet your expectations and are in compliance with California law.

Contact a Business Law Attorney in California

When you are considering the purchase of a franchise, it is critical to hire a California business law attorney to assist with a significant portion of the process. Attorney Lynnette Ariathurai has years of experience serving new and existing business owners in California and can speak with you today.

Contact us for more information about legal services for buying a franchise in California. We serve clients in Fremont, Hayward, Milpitas, Union City, and Newark, CA.