Financial troubles and bankruptcy are a reality in some franchisor/franchisee relationships, and a percentage of struggling franchisees will declare bankruptcy each year. Franchisors can also experience insolvency and the franchise systems will invoke the bankruptcy process. For both franchisor and franchisee, bankruptcy is a versatile tool created under title 11, Chapter 11 of the United States Code can accomplish different purposes depending on the situation including financial restructuring, effectuating a sale of the business, or liquidation.

The Bankruptcy Handbook for Franchisors and Franchisees explores bankruptcy issues relevant to franchisors and franchisees and the unique challenges that each must address in bankruptcy cases of the other. The chapter authors and editors, all experienced franchise law practitioners, address bankruptcy from every angle, including the different scenarios presented in the most commonly occurrence of a franchisee filing for bankruptcy, versus a franchisor bankruptcy filing.

In eleven insightful chapters, this book addresses the intersection of bankruptcy and franchise law from initial stages of contemplating a filing, through the various options presented in a bankruptcy case, and how it is resolved, whether through reorganization, a sale, or a liquidation.

Beginning with the core issues of pre-bankruptcy considerations and the bankruptcy filing, other chapters address:

• The automatic stay, the fundamental protection provided to the company filing bankruptcy
• Cash collateral issues under section 363(a) of the Bankruptcy Code
• The assumption, assumption and assignment, and rejection of franchise agreements in bankruptcy
• Intellectual property and licenses in bankruptcy
• Claims and claim litigation
• In-depth discussion of the issues involved in bankruptcy sales
• The required plan and disclosure statement filed with the court and the confirmation process
• Chapter 7 liquidation bankruptcy
• Individual reorganization bankruptcies