Would you like fries with that?
An arrangement in which the owner of intellectual property, such as a trademark, a trade name or a copyright, licenses others to use it in selling of goods or services
What is a franchise.
an association of two or more persons to carry on a s co-owners of a business for profit.
What is a partnership.
Name one of the primary rights a partner has in the partnership.
Management
Interest in profits (not compensation)
Inspection of books
Accounting
Property rights (partnership property not individuals)
LP
What is a Limited Partnership
LLP
What is a limited liability partnership
Anheuser-Bush enters into an agreement with a dealer to sell its products exclusively in a certain area. This is an example of what type of franchise?
Two of the three elements necessary to find the existence of a partnership
1. a sharing of profits or losses
2. a joint ownership of the business
3. An equal right to be involved in the management
If a partner learns of a business opportunity while working for the partnership and capitalizes on the opportunity individually, this is a breach of?
What is the duty of loyalty.
Two types of partners required for an LP
General partner and limited partner
What type of companies commonly use this form of entity
Personal service companies (ex. the big four accounting firms).
Applebees or McDonalds are examples of what type of franchise?
Explain the tax treatment of a partnership
Pass-through entity with filing of an informational return.
A creditor may hold each partner proportionally liable for the debt or seek payment all from one partner. This is called
What is joint and several liability.
Ways to form an LP
Requires filing with the state
Regulation of franchises include the Franchise Rule. What is the Franchise Rule
an FTC regulation requiring safeguards for franchisees such as requireing written disclosures of material facts to prospective franceisees.
1. Capital contributions
2. Sharing of profits/losses
3. Management and control
4. Dissolution/Dissociation
When is the sharing of profits not considered to be a partnership?
1. Profits (not losses) to employee for services
2. Payment of a debt.
3. Payment of an annuity to a widow or personal representative.
4. Payment from sale of goodwill
5. Payment of interest on a loan.
General partner has unlimited liability but limited partners have limited liability.
UPA and RUPA
What are the Uniform Partnership Act and the Revised Uniform Partnership Act.
One protection often provided by state law is the Good Cause requirement. What is this?
A Franchisor may not terminate a franchise agreement without good cause.
What is partnership by estoppel
Partnership holding a non-partner out as a partner will cause the partnership to be bound by the non-partner's actions.
Name two of the duties a partner has to the partnership/other parters
Duty of loyalty
Duty of Care
Fiduciary Duty
LLC
Limited Liability Company
How does the liability of an incoming partner differ from other partners?
New partner assumes limited liability for obligations that occurred before he or she became a partner