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Courts struggle for balance with material changes to renewal franchise agreement

Friday, July 07, 2017 @ 08:54 AM | By Ben Hanuka

How much leeway does a franchisor have to introduce material changes into a renewal franchise agreement? This depends on the wording of the renewal clause in the original franchise agreement.

On one end of the spectrum, the original renewal clause may provide the franchisor with an unequivocal right to introduce any type of material change into the renewal franchise agreement, from higher royalty and advertising contribution rates to any other materially different term that the franchisor uses in its "then-current" form of franchise agreement at the...