What is the timeframe for dismissing involuntary bankruptcy proceedings to avoid automatic termination of the My Salon Suite franchise?

According to My Salon Suite's 2025 Franchise Disclosure Document, the franchise agreement provides for termination upon bankruptcy. However, the FDD also states that this provision may not be enforceable under Federal Bankruptcy Law (11 U.S.C.A Sec. 101 et seq.).

This means that while the My Salon Suite franchise agreement includes a clause allowing for termination if a franchisee declares bankruptcy, federal law might override this clause. Federal bankruptcy laws are designed to protect debtors and may prevent franchisors from automatically terminating agreements solely based on a bankruptcy filing.

Because the enforceability of the termination clause is uncertain due to potential conflicts with federal law, it is important for a prospective franchisee to seek legal counsel to fully understand their rights and obligations in the event of bankruptcy. A legal professional can provide guidance on how federal bankruptcy laws would apply to the My Salon Suite franchise agreement and what steps a franchisee can take to protect their investment.