Is my franchise agreement void if the entire company went bankrupt?

min read
Opinions expressed by Entrepreneur contributors are their own.
Whether your franchise agreement can be voided depends on what it says. First, you will want to look for language that indicates whether or not the franchise agreement (or certain provisions) "survive the termination of the agreement."

Despite the franchise going bankrupt, the terms of the franchise agreement may make you personally liable for certain payments--and if you have not filed for bankruptcy protection, you could still be on the hook.

In addition, you'll want to look for language that allows the agreement to be "assigned" to another party, and what happens if that event occurs. Selling the company to another brand may or may not count.

To get a clear read on whether the agreement is still in force, you'll want to show it to an attorney who focuses on franchise matters.

More from Entrepreneur

Get heaping discounts to books you love delivered straight to your inbox. We’ll feature a different book each week and share exclusive deals you won’t find anywhere else.
Jumpstart Your Business. Entrepreneur Insider is your all-access pass to the skills, experts, and network you need to get your business off the ground—or take it to the next level.
Starting, buying, or growing your small business shouldn’t be hard. Guidant Financial works to make financing easy for current and aspiring small business owners by providing custom funding solutions, financing education, and more.

Latest on Entrepreneur