House Journal: Page 832: Monday, March 20, 2000
H-1517A
3 1. Page 6, by inserting after line 12 the
4 following:
5 " ___. A franchisee may transfer the franchisee's
6 interest in the franchise, for the unexpired term of
7 the franchise agreement, and a franchisor shall not
8 require the franchisee or the transferee to enter into
9 a new or different franchise agreement as a condition
10 of the transfer."
H-1517B
11 2. Page 6, by inserting after line 23 the
12 following:
13 " ___. A franchisor shall not transfer its interest
14 in a franchise unless the franchisor makes reasonable
15 provision for the performance of the franchisor's
16 obligations under the franchise agreement by the
17 transferee. For purposes of this section "reasonable
18 provision" means that upon the transfer, the entity
19 assuming the franchisor's obligation has the financial
20 means to perform the franchisor's obligations in the
21 ordinary course of business, but does not mean that
22 the franchisor transferring the franchise is required
23 to guarantee obligations of the underlying franchise
24 agreement."
H-1517C
25 3. Page 6, by inserting after line 32 the
26 following:
27 " ___. A franchisor, as a condition to a transfer
28 of a franchise, shall not obligate a franchisee to
29 undertake obligations or relinquish any rights
30 unrelated to the franchise proposed to be transferred,
31 or to enter into a release of claims broader than a
32 similar release of claims by the franchisor against
33 the franchisee which is entered into by the
34 franchisor.
35 ___. A franchisor shall not discriminate against a
36 proposed transferee of a franchise on the basis of
37 race, color, national origin, religion, sex, or
38 disability.
39 ___. A franchisor, after a transfer of a
40 franchise, shall not seek to enforce any convenant of
41 the transferred franchise against the transferor which
42 prohibits the transferor from engaging in any lawful
43 occupation or enterprise. However, this subsection
44 does not prohibit the franchisor from enforcing a
45 contractual convenant against the transferor not to
46 exploit the franchisor's trade secrets or intellectual
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League of Women Voters of Iowa
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