due diligence in franchise system aquisitions andrae j. marrocco partner 416-777-4046 cfa franchise...

Due Diligence in Franchise System Aquisitions

Andrae J. MarroccoPartner

amarrocco@dickinson-wright.com 416-777-4046

CFA Franchise Law DayJanuary 28, 2016

Edward (Ned) Levitt Partner

NLevitt@dickinson-wright.com416-646-3842

Due Diligence

• Goals of Due Diligence• Due Diligence Strategy

Due Diligence in Franchise M & A

1. The Intangible Assets2. Third Parties at the

Table3. Viability of the

Franchise System4. The Franchise

Agreement and Other Contracts

The Intangible Assets

• Trademarks• Proprietary Software• Operations Manuals,

Confidential Information, and Other Intellectual Property

Third Parties at the Table

• The Financial Health of the Franchisee Population

• “Taking the Temperature”

Viability of the Franchise System

• Compliance• Sales Protocols• The “Flip Rate”• Senior Management

Franchise Agreement / Contracts

• The Franchise Agreement• Different Versions • Indemnification• “Side Deals”• Logistical Concerns• Other Contract

Andrae J. MarroccoPartner

amarrocco@dickinson-wright.com 416-777-4046

Edward (Ned) Levitt Partner

NLevitt@dickinson-wright.com416-646-3842

Thank You