selling/closing a franchise business before lease ends

[shortfu]

I own a Snap Fitness gym in CA and operate it under an LLC. I recently ran into personal and financial difficulty that I need to sell the gym. I still not have met my obligated time yet. Snap HQ said that if closed my gym without its consent, I may be forced to pay the monthly club franchise fee for the remaining of obligated time.

I'm thinking just closing the gym and selling all the assets if I can't sell the gym. What legal ramifications that I need to consider should I pursue this option?

 

[justalayman]

Read your franchise agreement. If you are obligated to perform for XX months or years before termination then that is what it is.

 

[shortfu]

Thanks for the reply. What if i (my LLC) declare bankruptcy?

 

[justalayman]

Thanks for the reply. What if i (my LLC) declare bankruptcy?

I don't know since I know nothing about your LLC.

Did you personally guarantee anything?

 

[shortfu]

none. everything conducted under the LLC where I signed as the principle member.

 

[justalayman]

none. everything conducted under the LLC where I signed as the principle member.

It would require a full review of all the facts to be able to determine if you are in the clear here. You should run this past a bk attorney who can review all the facts and provide an opinion.