California  |  Bankruptcy

Legal Question

Asked on: 10/21/13, 11:10 am

I signed a franchise agreement that has 6 more years till it expires. If my business folds (I think it may in a couple months) my franchise says I am going to owe them the max amount of royalties for the 6 years so around 43,000 total. I do not own a house or car. I have no money or I would still have my business. So my question is if I declare bankruptcy can I break free of that debt. I don't mind paying in a chapter 13 or 11 payments towards what I owe but I can't figure out how I will be able to pay the full amount. Does bankruptcy cover franchise obligations or is it exempt like school tuition? Also will it break my lease for my building as well or am I still obligated to pay that too? I am determined to do my due diligence but trying to figure out what that is given my situation.

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