THE FRANCHISE AGREEMENT “Navigating the Franchise Paper Trail”
KEY SUBJECTS1. Use of Trademarks2. Location of the Franchise3. Term of the Franchise4. Franchisee’s Fees and Other Payments5. Obligations and Duties of the Franchisor6. Obligations and Duties of the Franchisee7. Restrictions on the Goods and Services Offered8. Renewal, Termination and Transfer of Franchise Agreement
Key Subject: Term of the Franchise• Specifies the duration of the agreement• Shows how long it lasts, rights of the franchisee to renew• May show rights of the franchisor to purchase the franchise before expiration
Key Subject: Fees & Other Payments• Describes the mandatory fees:- franchise fees- initial fees and what the franchisee receives for that fee- royalty fees, what is it based on and when is it due- advertising / marketing fees, what it is based on and when is it due- other fees
Key Subject:Obligation & Duties of the Franchisor• Describes in detail all the services which the franchisor will provide including, but not limited to, training, operations support, advertising, etc. Key Subject:Obligations & Duties of the Franchisee • Describes the franchisee’s responsibility including, but not limited to, training requirements, participation in the business, record-keeping, etc.
Key Subject: Restrictions• Describes any restrictions placed on the good and services offered, including: - Required quality standards - Approved suppliers - Approved advertising - Hours of operation - Pricing
Key Subject: Renewal, Termination & Transfer• Includes the rights of the franchisee upon termination• Includes descriptions of the transfer of the franchise agreement• Includes descriptions about the renewal of the franchise agreement
The Franchise Agreement Read & understand the agreement thoroughly before signing Legally, you have 5 business days to review and sign it Make sure you hire an experienced franchise attorney to review the agreement