Kit Represents Buyers and Sellers During Franchise Mergers & Acquisitions

Franchise mergers and acquisitions are complex deals with lots of moving parts. For franchisors that are selling their systems, they need to ensure that their business is well ordered and transparent in order to obtain the largest cash-out. For buyers, thorough due diligence is key to proper valuation, as there are numerous potential issues that can lead to liability and other legal risks down the line that can be expensive and time consuming. 

At Kit Franchise Law, Kit provides comprehensive and strategic legal representation for buyers and sellers during franchise mergers and acquisitions. Founding attorney Kit Higgs brings well over a decade of relevant experience to the table. Kit can guide you through the M&A maze, help you make informed decisions at every stage of the process, and efficiently march the deal to close, minimizing your stress and maximizing your profit.

Representation for Franchisors Selling Their Franchise Systems

There are several important legal considerations involved in selling a franchise system. When selling their systems, franchisors must address all of these considerations, and they must ensure that the final asset purchase agreement accurately reflects the negotiated terms of the deal. Examples of the types of issues Kit helps his clients address when selling their franchise systems include:

  • Auditing FDD registration, disclosure, franchise agreements, transfers, defaults and terminations
  • Drafting and overseeing the completion of the disclosure schedules
  • Identifying and analyzing deficiencies and liabilities with FDD registration, disclosure  and franchise agreements  
  • Obtaining all necessary approvals for third-party contract assignments and transfers
  • Assigning liability and establishing the buyer’s duty to indemnify for potential franchisee and other third-party claims

Representation for Buyers in Franchise M&A Transactions

For buyers, acquiring a franchise system presents a multitude of legal considerations as well. Kit will work through these considerations systematically, gathering the data and conducting the analyses his clients need to make informed decisions in real-time. This involves taking steps including (but by no means limited to):

  • Conducting due diligence on the franchisor entity and the franchise system
  • Reviewing the Franchise Disclosure Document (FDD) and all state registration files
  • Ensuring that the franchisor has signed receipt pages from all current and former franchisees
  • Ensuring that all franchise agreements and all related contracts and addendums have appropriate signatures from the franchisee’s authorized representatives and guarantors
  • Clearly documenting the transfer of the seller’s trademarks and other relevant IP assets
  • Limiting the buyer’s liability for claims arising prior to the date of acquisition and negotiating other necessary contractual protections

Along with guiding buyers through the acquisition process, Kit provides assistance with all other relevant legal matters as well. This includes forming new business entities, merging newly-acquired franchise systems into existing operations, handling employment-related issues, and providing legal advice on an ongoing basis.

Schedule an Appointment at Kit Franchise Law

If you need to engage legal counsel for a franchise merger or acquisition, we encourage you to contact Kit for more information. We can arrange a time for you to speak with founding attorney Kit Higgs directly. To schedule a confidential consultation with Kit Franchise Law, please call 513-223-3125 or contact us online today.