If involuntary bankruptcy proceedings are commenced against a Brightstar Care franchisee, how long does the franchisee have to dismiss the proceedings to avoid automatic termination of the Franchise Agreement?

According to Brightstar Care's 2025 Franchise Disclosure Document, if involuntary bankruptcy proceedings are commenced against a franchisee, the franchisee has a limited time to dismiss those proceedings to avoid automatic termination of the Franchise Agreement. Specifically, the agreement will automatically terminate if proceedings to have the franchisee adjudicated bankrupt or reorganized under state or federal bankruptcy or insolvency law are not dismissed within sixty days.

This sixty-day window is crucial for a Brightstar Care franchisee facing involuntary bankruptcy. During this period, the franchisee must take decisive action to either dismiss the proceedings or prevent the appointment of a trustee or receiver. Failure to do so results in the automatic termination of the franchise agreement, which would lead to a loss of the franchise rights.

It is also important to note that the appointment of a trustee or receiver for the franchisee or the franchised business, or an order for relief being entered against the franchisee, or the conversion of the involuntary case to a voluntary case in bankruptcy, will result in automatic termination of the agreement, even if it occurs before the end of the sixty-day period. This highlights the importance of acting swiftly to address any involuntary bankruptcy proceedings to protect the franchise rights.