Franchise Agreement Attorneys in Houston

Protect Your Investment with Experienced Legal Review of Franchise Agreements & Disclosure Documents

Considering a franchise investment in Texas? Our experienced franchise attorneys can analyze every detail of your Franchise Disclosure Document (FDD) and franchise agreement to identify red flags, unfavorable terms, and hidden risks that could cost you thousands.

We’ve been protecting Texas franchisees since 1987. Let our experience help you launch your franchise with confidence. 

Watch for these FDD, Franchise Agreement Red Flags

Franchise agreements are complex legal documents designed to protect the franchisor's interests – not the franchisee. 

Without experienced legal counsel, you may unknowingly agree to:

• Excessive initial and ongoing fees that reduce your profitability
• Ambiguous or one-sided contract language
• Restrictive non-compete clauses that trap you in unprofitable situations
• Inadequate or undocumented training and support obligations 
• Forum selection clauses that require you to settle disputes in the franchisor’s home territory
• Limited grounds to terminate a franchise agreement even if the franchisor is in breach
• Personal guarantee with unfavorable terms and limits
• Unrealistic earnings claims without solid data and proven business models to back them up

Another common issue we encounter are verbal promises not captured in the agreement. If it’s not in writing, you will not have any recourse to defend your interests should verbal promises go unfulfilled.

FDD and Franchise Agreement Legal Review Services in Texas

The average franchise agreement is 50+ pages of dense legal language. At Hendershot Cowart, we can review your FDD and franchise agreement with an eye on protecting your rights and to ensure that the franchisor’s responsibilities to you are fully and clearly expressed.

Key provisions we examine:

• Financial Obligations: Initial fees, royalties, marketing contributions, and additional costs
• Operational Requirements: Standards, procedures, and compliance obligations
• Territory and Competition: Exclusive rights, protected areas, and non-compete restrictions
• Termination and Renewal: Exit conditions, renewal terms, and post-termination obligations
• Dispute Resolution: Forum selection, arbitration requirements, and legal procedure

Franchise Agreement Redlines and Negotiations

When we identify problematic terms, we don't just point them out – we help you address them. 

Common provisions or issues we can negotiate or clarify on your behalf prior to signing include:

• Ambiguous language about the franchisor’s obligations to support the franchisee
• Territory rights, which can help protect your business from competition within the franchise
• First right of refusal on the option to establish another location in an adjoining territory
• Dispute resolution and forum selection clauses. If there is a dispute, the franchisor will often select an arbitration forum in the city of its headquarters, requiring the franchisee to incur travel expenses to dispute the matter. Instead, negotiate a forum convenient to you.

In addition to establishing the legal obligations for both the franchisor and franchisee, the franchise agreement should clearly outline your renewal rights, rights respecting transfer or sale, and termination rights. 

If any of these rights are ambiguous or missing, your attorney can negotiate with the franchisor to clarify or add these provisions.

What Information Should Be Included in a Franchise Disclosure Document?

A franchise disclosure document (FDD) is required by the Federal Trade Commission and is critical to performing pre-sale due diligence when buying a franchise. 

An FDD always consists of the same 23 items, including:

• The franchise agreement
• A description of the company and its history
• Biographical information on the franchisor’s officers or executive team
• Any past or current litigation or legal actions against the franchise
• Initial and other fees
• The support provided by the franchisor, such as training, advertising, computer applications, etc.
• The franchisee’s obligations for running their business
• The franchisee’s territory
• Trademarks and other proprietary information registered to the franchise
• Conditions for renewal, termination, or transfer
• Financial statements
• The process for dispute resolution, and more

Pay special attention to item 22 (the franchise agreement), as well as items 5, 6, 7, and 19. Items 5 and 6 cover initial and ongoing fees, item 7 details the initial investment required to establish a franchise, and item 19 includes information about the franchisor’s financial performance. 

Franchise Agreement Review FAQs

How long does a franchise agreement review take? 

Our attorneys can often review your franchise agreement and FDD within just a few days of your initial call. Call (713) 783-3110 to schedule the review and one-hour consultation with an attorney. 

What if the franchisor won't negotiate terms? 

While not all terms are negotiable, many franchisors will consider reasonable modifications. We help you identify which terms are worth pursuing and how to approach negotiations professionally.

Can you review the agreement even if I've already signed? 

Yes, we can review existing agreements to help you understand your obligations. Often, we are asked to review franchise agreements when a dispute is already simmering. In those circumstances, we can help identify potential grounds for negotiating an exit to an agreement that did not live up to its promises. 

Do you work with specific franchise brands? 

We review agreements for all franchise brands and industries, from food service to retail to business services.

What are your fees for franchise agreement review? 

Our review fees are transparent and fixed-price. We can provide detailed fee information when you contact us to schedule your consultation.

Ready to Protect Your Franchise Investment?

Don't risk your financial future on an uninformed decision. Our experienced Texas franchise attorneys are ready to review your franchise agreement and FDD, providing the clarity and protection you need.

Call (713) 783-3110 to schedule your franchise agreement review and consultation today.