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Franchise Agreement

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  1. Franchisor and franchisee
  2. The franchise grant
  3. Fees and royalty
  4. Operations, sourcing and restraint
  5. Termination, disputes and signing

Step 1 of 5

Franchisor and franchisee

For example: Northline Foods Private Limited

Franchisor's constitutionNeeded
Franchisor's addressNeeded

For example: Rohit Nair, Director

For example: Bansal Fresh Foods

Franchisee's constitutionNeeded
Franchisee's addressNeeded

For example: Kavita Bansal, Proprietor

For example: Northline Kitchen

More details — you may leave these

Leave blank if the mark is not yet registered, or registration is pending.

A long answer. Several lines are fine, and a break you make between paragraphs is the break the document keeps.

For example: Registered trademark no. 4567890 in Class 43, Trade Marks Registry, Delhi

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FRANCHISE AGREEMENT

This Franchise Agreement (this "Agreement") is made at __________ on __________.

BETWEEN

__________, __________, of __________, acting through __________ (the "Franchisor");

AND

__________, __________, of __________, acting through __________ (the "Franchisee").

The Franchisor and the Franchisee are each a "Party" and together the "Parties".

RECITALS

A. The Franchisor owns, or has the right to license, the brand "__________" and an associated business system.

B. __________

C. The Franchisee wishes to operate an outlet under that brand and system, on the terms of this Agreement.

NOW THIS AGREEMENT WITNESSES AS FOLLOWS.

  1. GRANT

1.1 The Franchisor grants to the Franchisee, for the Term, the right to operate an outlet at __________ (the "Outlet") under the brand "__________" and the business system described in Recital B, subject to this Agreement.

1.2 __________

1.3 The territory of this franchise is: __________ (the "Territory").

  1. TRADEMARK LICENCE

2.1 The Franchisor licenses the Franchisee to use the brand "__________" and its associated marks, signage and get-up solely in connection with the Outlet and strictly in accordance with the Franchisor's brand guidelines and the operating standards stated in clause 6. This licence is non-transferable and ends automatically on termination or expiry of this Agreement.

2.2 The Franchisee acknowledges the Franchisor's ownership of the brand and associated marks, shall do nothing inconsistent with that ownership, and shall not register or attempt to register any mark, domain name or business name confusingly similar to it.

2.3 The Franchisor may exercise reasonable quality control over the Franchisee's use of the brand, including inspection of the Outlet, to protect the validity and reputation of the marks.

  1. FEES

3.1 The Franchisee shall pay the Franchisor a one-time franchise fee of __________ on execution of this Agreement, which is earned on payment and is not refundable except as this Agreement expressly provides.

3.2 The Franchisee shall pay the Franchisor an ongoing royalty of __________

3.7 All amounts under this clause 3 are exclusive of goods and services tax, which the Franchisee shall additionally pay where chargeable, and are subject to tax deduction at source at the rate the Income-tax Act, 1961 for the time being requires.

  1. TERM AND RENEWAL

4.1 This Agreement is for a Term of __________ years from the date of this Agreement (the "Term"), unless earlier terminated under clause 9.

4.2 __________

  1. TRAINING

5.2 The Franchisee shall ensure that the persons operating the Outlet complete the training the Franchisor requires before the Outlet opens, and thereafter as the Franchisor reasonably directs.

  1. OPERATING STANDARDS

6.1 The Franchisee shall operate the Outlet strictly in accordance with: __________

6.2 The Franchisee shall maintain the Outlet's appearance, hygiene, staffing and customer service to the standard the Franchisor's operations manual requires, and shall permit the Franchisor, on reasonable notice, to inspect the Outlet to confirm compliance.

  1. SOURCING

7.1 __________

  1. INDEPENDENT BUSINESS; COMPLIANCE

8.1 The Franchisee operates the Outlet as an independent business, at its own cost and risk, and is responsible for its own staff, licences (including any shop and establishment registration, FSSAI licence, trade licence or other consent the Outlet's business requires), taxes and statutory compliance. Nothing in this Agreement makes the Franchisor liable for the Franchisee's obligations to its staff, customers, suppliers or any authority.

  1. TERMINATION

9.1 Either Party may terminate this Agreement by written notice if the other Party commits a material breach of this Agreement that is capable of remedy and is not remedied within __________ days of written notice specifying the breach.

9.2 The Franchisor may terminate this Agreement immediately by written notice if the Franchisee: becomes insolvent or makes an arrangement with creditors; commits a breach that is not capable of remedy, including unauthorised use of the brand after notice, or conduct seriously damaging the brand's reputation; or fails to pay an amount due under clause 3 within thirty days of it falling due.

  1. CONSEQUENCES OF TERMINATION OR EXPIRY

10.1 On termination or expiry of this Agreement, the Franchisee shall immediately: stop operating under the brand "__________" and using its marks, signage, get-up and any confusingly similar name; remove all signage and branded material from the Outlet, or, if the Franchisor so elects, permit the Franchisor to do so at the Franchisee's cost; return or destroy the operations manual and confidential material, and confirm this in writing; and pay all amounts due under clause 3 up to the date of termination or expiry.

10.2 Termination or expiry does not affect a right or liability that accrued before it, or a clause that by its nature is meant to survive, including clauses 2.2, 11, 12, 13 and this clause 10.

  1. NON-COMPETE

11.1 While this Agreement is in force, the Franchisee shall not operate, or have an interest in, a business that competes with the brand within the Territory, other than the Outlet itself.

11.2 For __________ year(s) after termination or expiry, the Franchisee shall not operate, or have an interest in, a business substantially imitating the Franchisor's business system within the Territory. The Parties intend this restraint to protect the Franchisor's proprietary system and goodwill rather than to prevent the Franchisee from earning a livelihood generally, and it is to be read no more widely than that purpose requires; see the note on this page on section 27 of the Indian Contract Act, 1872.

  1. CONFIDENTIALITY

12.1 The Franchisee shall keep confidential the Franchisor's operations manual, recipes, processes, pricing and other non-public business information, and shall not use or disclose it other than to operate the Outlet under this Agreement, both during the Term and after it ends.

  1. INDEMNITY

13.1 The Franchisee shall indemnify the Franchisor against a claim, loss or liability arising from the Franchisee's operation of the Outlet, other than to the extent it arises from the Franchisor's own breach of this Agreement or from a defect in the brand, system or products as supplied by the Franchisor.

  1. ASSIGNMENT

14.1 The Franchisee shall not assign, sub-franchise or transfer this Agreement or the Outlet's operation to anyone else without the Franchisor's prior written consent, which the Franchisor may condition on the transferee completing training and agreeing in writing to be bound by this Agreement.

  1. NO AGENCY OR PARTNERSHIP

15.1 Nothing in this Agreement creates a partnership, joint venture, or a relationship of agency or employment between the Parties. The Franchisee has no authority to bind the Franchisor, and shall not represent to anyone that such authority exists.

  1. DISPUTE RESOLUTION AND GOVERNING LAW

16.1 __________

16.2 The seat and venue of any arbitration under this Agreement, and the place of any court proceedings, is __________, and the courts at __________ have exclusive jurisdiction, subject to any arbitration agreed above.

16.3 This Agreement is governed by the laws of India as in force in __________.

  1. STAMP DUTY

17.1 This Agreement is executed in __________. Stamp duty on this Agreement is borne by __________.

  1. GENERAL

18.1 This Agreement is the entire agreement between the Parties about its subject matter and supersedes all prior discussion, whether oral or in writing.

18.2 No amendment is effective unless made in writing and signed by both Parties, except that the Franchisor may update its operations manual and brand guidelines from time to time by written notice to the Franchisee, and the Franchisee shall comply with the updated version, provided an update does not increase the fees payable under clause 3 without the Franchisee's written consent.

18.3 If any provision is held invalid or unenforceable, the rest of this Agreement continues in effect.

IN WITNESS WHEREOF the Parties have executed this Agreement at __________ on __________.

SIGNED AND DELIVERED by the FRANCHISOR
__________
Through: __________

Signature: ______________________________

SIGNED AND DELIVERED by the FRANCHISEE
__________
Through: __________

Signature: ______________________________

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FRANCHISE AGREEMENT

This Franchise Agreement (this "Agreement") is made at __________ on __________.

BETWEEN

__________, __________, of __________, acting through __________ (the "Franchisor");

AND

__________, __________, of __________, acting through __________ (the "Franchisee").

The Franchisor and the Franchisee are each a "Party" and together the "Parties".

RECITALS

A. The Franchisor owns, or has the right to license, the brand "__________" and an associated business system.

B. __________

C. The Franchisee wishes to operate an outlet under that brand and system, on the terms of this Agreement.

NOW THIS AGREEMENT WITNESSES AS FOLLOWS.

  1. GRANT

1.1 The Franchisor grants to the Franchisee, for the Term, the right to operate an outlet at __________ (the "Outlet") under the brand "__________" and the business system described in Recital B, subject to this Agreement.

1.2 __________

1.3 The territory of this franchise is: __________ (the "Territory").

  1. TRADEMARK LICENCE

2.1 The Franchisor licenses the Franchisee to use the brand "__________" and its associated marks, signage and get-up solely in connection with the Outlet and strictly in accordance with the Franchisor's brand guidelines and the operating standards stated in clause 6. This licence is non-transferable and ends automatically on termination or expiry of this Agreement.

2.2 The Franchisee acknowledges the Franchisor's ownership of the brand and associated marks, shall do nothing inconsistent with that ownership, and shall not register or attempt to register any mark, domain name or business name confusingly similar to it.

2.3 The Franchisor may exercise reasonable quality control over the Franchisee's use of the brand, including inspection of the Outlet, to protect the validity and reputation of the marks.

  1. FEES

3.1 The Franchisee shall pay the Franchisor a one-time franchise fee of __________ on execution of this Agreement, which is earned on payment and is not refundable except as this Agreement expressly provides.

3.2 The Franchisee shall pay the Franchisor an ongoing royalty of __________

3.7 All amounts under this clause 3 are exclusive of goods and services tax, which the Franchisee shall additionally pay where chargeable, and are subject to tax deduction at source at the rate the Income-tax Act, 1961 for the time being requires.

  1. TERM AND RENEWAL

4.1 This Agreement is for a Term of __________ years from the date of this Agreement (the "Term"), unless earlier terminated under clause 9.

4.2 __________

  1. TRAINING

5.2 The Franchisee shall ensure that the persons operating the Outlet complete the training the Franchisor requires before the Outlet opens, and thereafter as the Franchisor reasonably directs.

  1. OPERATING STANDARDS

6.1 The Franchisee shall operate the Outlet strictly in accordance with: __________

6.2 The Franchisee shall maintain the Outlet's appearance, hygiene, staffing and customer service to the standard the Franchisor's operations manual requires, and shall permit the Franchisor, on reasonable notice, to inspect the Outlet to confirm compliance.

  1. SOURCING

7.1 __________

  1. INDEPENDENT BUSINESS; COMPLIANCE

8.1 The Franchisee operates the Outlet as an independent business, at its own cost and risk, and is responsible for its own staff, licences (including any shop and establishment registration, FSSAI licence, trade licence or other consent the Outlet's business requires), taxes and statutory compliance. Nothing in this Agreement makes the Franchisor liable for the Franchisee's obligations to its staff, customers, suppliers or any authority.

  1. TERMINATION

9.1 Either Party may terminate this Agreement by written notice if the other Party commits a material breach of this Agreement that is capable of remedy and is not remedied within __________ days of written notice specifying the breach.

9.2 The Franchisor may terminate this Agreement immediately by written notice if the Franchisee: becomes insolvent or makes an arrangement with creditors; commits a breach that is not capable of remedy, including unauthorised use of the brand after notice, or conduct seriously damaging the brand's reputation; or fails to pay an amount due under clause 3 within thirty days of it falling due.

  1. CONSEQUENCES OF TERMINATION OR EXPIRY

10.1 On termination or expiry of this Agreement, the Franchisee shall immediately: stop operating under the brand "__________" and using its marks, signage, get-up and any confusingly similar name; remove all signage and branded material from the Outlet, or, if the Franchisor so elects, permit the Franchisor to do so at the Franchisee's cost; return or destroy the operations manual and confidential material, and confirm this in writing; and pay all amounts due under clause 3 up to the date of termination or expiry.

10.2 Termination or expiry does not affect a right or liability that accrued before it, or a clause that by its nature is meant to survive, including clauses 2.2, 11, 12, 13 and this clause 10.

  1. NON-COMPETE

11.1 While this Agreement is in force, the Franchisee shall not operate, or have an interest in, a business that competes with the brand within the Territory, other than the Outlet itself.

11.2 For __________ year(s) after termination or expiry, the Franchisee shall not operate, or have an interest in, a business substantially imitating the Franchisor's business system within the Territory. The Parties intend this restraint to protect the Franchisor's proprietary system and goodwill rather than to prevent the Franchisee from earning a livelihood generally, and it is to be read no more widely than that purpose requires; see the note on this page on section 27 of the Indian Contract Act, 1872.

  1. CONFIDENTIALITY

12.1 The Franchisee shall keep confidential the Franchisor's operations manual, recipes, processes, pricing and other non-public business information, and shall not use or disclose it other than to operate the Outlet under this Agreement, both during the Term and after it ends.

  1. INDEMNITY

13.1 The Franchisee shall indemnify the Franchisor against a claim, loss or liability arising from the Franchisee's operation of the Outlet, other than to the extent it arises from the Franchisor's own breach of this Agreement or from a defect in the brand, system or products as supplied by the Franchisor.

  1. ASSIGNMENT

14.1 The Franchisee shall not assign, sub-franchise or transfer this Agreement or the Outlet's operation to anyone else without the Franchisor's prior written consent, which the Franchisor may condition on the transferee completing training and agreeing in writing to be bound by this Agreement.

  1. NO AGENCY OR PARTNERSHIP

15.1 Nothing in this Agreement creates a partnership, joint venture, or a relationship of agency or employment between the Parties. The Franchisee has no authority to bind the Franchisor, and shall not represent to anyone that such authority exists.

  1. DISPUTE RESOLUTION AND GOVERNING LAW

16.1 __________

16.2 The seat and venue of any arbitration under this Agreement, and the place of any court proceedings, is __________, and the courts at __________ have exclusive jurisdiction, subject to any arbitration agreed above.

16.3 This Agreement is governed by the laws of India as in force in __________.

  1. STAMP DUTY

17.1 This Agreement is executed in __________. Stamp duty on this Agreement is borne by __________.

  1. GENERAL

18.1 This Agreement is the entire agreement between the Parties about its subject matter and supersedes all prior discussion, whether oral or in writing.

18.2 No amendment is effective unless made in writing and signed by both Parties, except that the Franchisor may update its operations manual and brand guidelines from time to time by written notice to the Franchisee, and the Franchisee shall comply with the updated version, provided an update does not increase the fees payable under clause 3 without the Franchisee's written consent.

18.3 If any provision is held invalid or unenforceable, the rest of this Agreement continues in effect.

IN WITNESS WHEREOF the Parties have executed this Agreement at __________ on __________.

SIGNED AND DELIVERED by the FRANCHISOR
__________
Through: __________

Signature: ______________________________

SIGNED AND DELIVERED by the FRANCHISEE
__________
Through: __________

Signature: ______________________________

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