California Business and Professions Code

§ 20999.25

BPC § 20999.25Div. 8 · Ch. 7.5

Statute text

(a)In the case of leased marketing premises as to which the franchisor owns a fee interest, the franchisor shall not sell, transfer, or assign to another person the franchisor’s interest in the premises unless the franchisor has first either made a bona fide offer to sell, transfer, or assign to the franchisee the franchisor’s interest in the premises, other than signs displaying the franchisor’s insignia and any other trademarked, servicemarked, copyrighted or patented items of the franchisor, or, if applicable, offered to the franchisee a right of first refusal of any bona fide offer acceptable to the franchisor made by another to purchase the franchisor’s interest in the premises.

(b)In the case of leased marketing premises which the franchisor leases from a third party, following notice by the franchisor to the franchisee of termination or nonrenewal of the franchise by reason of the expiration of the franchisor’s underlying lease from the third party, the franchisor shall, upon request by the franchisee and subject to the franchisee purchasing or leasing the premises from the third party prior to the date of termination or nonrenewal of the franchise set forth in the notice, make a bona fide offer to sell to the franchisee any interest the franchisor may have in the improvements on the premises, other than signs displaying the franchisor’s insignia and any other trademarked, servicemarked, copyrighted or patented items of the franchisor, at a price not to exceed the fair market value of the improvements or the book value, whichever is greater, or, if applicable, offer the franchisee a right of first refusal of any bona fide offer acceptable to the franchisor made by another to purchase the franchisor’s interest in the improvements. For the purposes of this subdivision, “book value” means actual cost less actual depreciation taken.

(c)Nothing in this section shall be deemed to require a franchisor to continue an existing franchise agreement or to renew a franchise relationship if not otherwise required by federal law.

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Legislative history

Amended by Stats. 1985, Ch. 442, Sec. 1.