Sec. 9. Effect of termination
262 words·~1 min read·
/bill/115/hr/470/ih/section-9·A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
Upon termination of a franchise for whatever cause or reason, except voluntary relinquishment or abandonment of the franchise by the franchisee or the expiration of the franchise agreement where the franchisee does not elect to renew, the franchisor shall fairly compensate the franchisee or franchisee’s estate for the fair market value at the time of termination of the franchise, of the franchisee’s inventory, supplies, equipment, and furnishings purchased by the franchisee from the franchisor or its approved sources and the fair market value of the going concern value and good will of the business, if any, exclusive of personalized items which have no value to the franchisor and inventory, supplies, equipment, and furnishings not reasonably required in the conduct of the franchise business; provided, however, that— compensation need not be made to franchisee of going concern value and good will if the franchisor agrees in writing not to enforce a covenant which restrains the franchisee from competing with the franchisor in the same or substantially similar business in the same or substantially similar manner at the same location using the same property except the franchisor’s registered trademark or trade name; and a franchisor may offset against amounts owed to a franchisee under this subsection any amount mutual agreed upon and owed by the franchisee to franchisor which is not the subject of a good faith dispute by the franchisee.
The provisions of this section shall not be construed to permit the termination or nonrenewal of any franchise agreement except in accordance with the express terms of the franchise agreement and this Act.