If Deer Solution sells a terminated franchisee's rights, is the franchisee entitled to compensation?

According to Deer Solution's 2025 Franchise Disclosure Document, if the franchise agreement is terminated, Deer Solution has the right to sell the terminated franchisee's rights without providing any compensation to the franchisee. This means that if Deer Solution terminates the franchise agreement, they can then market, sell, transfer, convey, and assign the rights that were initially granted to the franchisee to another party, and the original franchisee will not receive any payment or consideration from Deer Solution for this transfer.

This provision is a significant risk for potential Deer Solution franchisees. If Deer Solution terminates the agreement (even if the franchisee believes the termination is unjustified), the franchisee loses not only their business but also any potential value from the franchise rights being resold. The franchisee also remains liable for outstanding payments and potential lost future revenues to Deer Solution.

This type of clause is not uncommon in franchise agreements, as it protects the franchisor's ability to maintain and control its brand and network. However, prospective franchisees should carefully consider the circumstances under which Deer Solution can terminate the agreement and the potential financial consequences of such termination. It is advisable to seek legal counsel to fully understand the implications of this provision before investing in a Deer Solution franchise.