SB129 - Protect Alabama Small Businesses Act Summary

• Creates comprehensive franchise regulations requiring franchisors to terminate or refuse renewal only for "good cause," defined as illegal drug use, indictment for crimes involving moral turpitude, fraud, misappropriation of funds, material contract violations, or willful conduct materially injuring the franchisor's reputation.

• Mandates franchisors repurchase inventory, supplies, equipment, fixtures, and goodwill at fair market value upon termination or nonrenewal without good cause, or waive all noncompete obligations allowing franchisees to continue in business.

• Prohibits franchisors from denying franchise transfers or assignments to qualified buyers meeting nondiscriminatory, material, and reasonable standards, with a 60-day approval period required after written notice.

• Establishes that franchise agreements are continuing unless terminated under the act or franchisor completely withdraws from the geographic market; allows surviving spouses, heirs, and estates to participate in franchise ownership without franchisor interference.

• Provides remedies including fair market value compensation for franchise business and assets, damages for violations, attorney fees to the prevailing party, and potential punitive damages for malicious conduct; applies to all franchises involving Alabama residents or franchisees.