What is the U.S. Code section that may affect the enforceability of the Belocal Franchise Agreement's termination upon bankruptcy provision?

According to Belocal's 2025 Franchise Disclosure Document, the enforceability of the franchise agreement's termination upon bankruptcy provision may be affected by federal bankruptcy law. Specifically, the document cites 11 U.S.C.A. Sec. 101 et seq. as the relevant section of the U.S. Code. This means that certain provisions within the Belocal Franchise Agreement that allow for termination due to a franchisee's bankruptcy may not be upheld in court due to federal bankruptcy laws.

This is a fairly standard disclosure in franchise agreements, as federal bankruptcy law is designed to protect debtors and ensure fair treatment of creditors. The specific sections referenced (11 U.S.C.A. Sec. 101 et seq.) cover a broad range of topics related to bankruptcy, including definitions, eligibility for different types of bankruptcy, and the rights and responsibilities of debtors and creditors.

For a prospective Belocal franchisee, this means that if they were to file for bankruptcy, Belocal's ability to terminate the franchise agreement solely based on that bankruptcy may be limited. It is important to note that this does not prevent Belocal from taking other actions if the franchisee is in breach of the agreement for reasons other than the bankruptcy itself. Franchisees should consult with a legal professional to fully understand their rights and obligations in the event of bankruptcy.