By Baghdadi lawyer
•
September 28, 2025
franchise Agreement (Sample) Between the following parties: First Party (Franchisor): Name / Company: …………………………………………………………… Address: ……………………………………………………………………… Commercial Registration / License No.: …………………………………… Represented by: ……………………………………… in his capacity as ………… (hereinafter referred to as “the Franchisor”) Second Party (Franchisee): Name / Company: …………………………………………………………… Address: ……………………………………………………………………… Commercial Registration / License No.: …………………………………… Represented by: ……………………………………… in his capacity as ………… (hereinafter referred to as “the Franchisee”) Preamble: Whereas the Franchisor owns the rights to use the trademark and business system “Franchise Model” and possesses technical and operational expertise, and whereas the Franchisee desires to use such rights in its own business, the parties agree to the following: Article (1): Definitions and General Provisions: The following terms shall have the meanings assigned to them: Trademark: ……………………………………… Operating System / Business Model: Operating manuals, administrative procedures, quality standards, operational guides, etc. Exclusive Territory: …………………………………………… Term of the Agreement: From … to … unless renewed pursuant to this Agreement. Financial Consideration / Fees: Initial franchise fee, ongoing royalties (e.g., a percentage of sales or fixed monthly fee), support or training fees. Franchisor Services: Technical support, marketing, training, supervision, supply chain, quality management, etc. Confidentiality: All technical or commercial information disclosed that must not be revealed to third parties. Article (2): Rights of the Franchisor and Granted Licenses: The Franchisor grants the Franchisee the right to use the trademark and operating system in the designated territory during the term of this Agreement. The grant is exclusive / non-exclusive (as agreed). The Franchisor shall not grant any franchise to another party within the same territory (if agreed). The Franchisor shall provide operational documents and procedures and keep them updated as needed. Article (3): Obligations of the Franchisee: Strictly comply with the Franchisor’s instructions regarding operations, quality, marketing, design, and uniform requirements (if any). Use the trademark only under the specified terms and in a manner that preserves the Franchisor’s reputation. Submit periodic reports (financial and operational) to the Franchisor. Cover all operating expenses, licenses, maintenance, and insurance at the Franchisee’s own cost. Refrain from competing during the term of the Agreement and within the territory, if agreed. Allow the Franchisor or its representative to inspect the premises (with reasonable notice) to ensure compliance. Train staff in accordance with the Franchisor’s requirements. Article (4): Financial Consideration / Fees: Initial Franchise Fee: ……………………………………… Ongoing Fees (monthly/quarterly/annual): …% of gross sales or a fixed amount of … Support / Marketing / Training Fees: If any, amounts and payment methods shall be specified. Define payment methods, due dates, late payment penalties, and applicable deductions. Article (5): Term and Renewal: The term of this Agreement shall commence on … and end on … If the Franchisee wishes to renew, written notice must be given to the Franchisor at least … (e.g., 6 months) prior to expiration. Renewal shall be under the same terms or such terms as mutually agreed in writing. If the Franchisor does not respond within … days, it shall be deemed acceptance (if agreed). Article (6): Termination and Cancellation: This Agreement terminates upon expiration unless renewed. Either party may terminate this Agreement if the other party fails to perform a material obligation, provided written notice is given with a cure period (e.g., 30 days). Upon termination, the Franchisee must immediately cease using the trademark and return all Franchisor materials and documentation. Fees already paid shall not be refunded unless otherwise agreed. Assignment or transfer of the franchise to a third party is not permitted without the Franchisor’s prior written consent. Article (7): Confidentiality and Protection of Information: Both parties shall maintain confidentiality of all proprietary, commercial, and technical information disclosed under this Agreement. This confidentiality obligation shall survive the expiration or termination of this Agreement for a period of … years (e.g., 5 years). Disclosure shall be permitted only if required by law or by competent governmental authorities. Article (8): Intellectual Property: The Franchisee acknowledges that all intellectual property rights, including trademarks, belong exclusively to the Franchisor. The Franchisee shall not use the trademark after termination or use it for activities outside the scope of this Agreement. Any infringement by the Franchisee on the Franchisor’s intellectual property shall render the Franchisee fully liable for damages. Article (9): Amendments and Developments: This Agreement may be amended only by written consent of both parties. If the Franchisor modifies the operating system or brand policies, the Franchisee shall be notified and given an opportunity to implement such changes. The Franchisor may require the Franchisee to implement certain updates (e.g., technical upgrades, expansions, or new features) under fair and reasonable conditions. Article (10): Force Majeure Performance of obligations may be suspended or excused temporarily in the event of circumstances beyond the control of either party (e.g., war, natural disasters, new legislation preventing performance), provided prompt notice is given and reasonable efforts to mitigate are undertaken. Article (11): Liability and Insurance: Each party shall be responsible for its own actions and operations during the term of this Agreement. The Franchisee shall maintain insurance coverage for the premises, equipment, and civil liability as required. The Franchisor shall not be liable for operational errors of the Franchisee unless such errors result from unreasonable instructions issued by the Franchisor. Article (12): Dispute Resolution: Any dispute arising out of or in connection with this Agreement shall first be resolved amicably. Failing amicable settlement, the dispute shall be submitted to arbitration under the laws of __________ (country) or to the competent court of __________ (if agreed). The seat of arbitration and the governing language shall be specified herein. Article (13): General Provisions: This Agreement constitutes the entire understanding between the parties and supersedes all prior agreements or communications, whether oral or written. If any provision of this Agreement is deemed invalid or unlawful by a competent court, the remaining provisions shall remain in full force, and a valid substitute clause shall be agreed upon. Notices between the parties shall be sent to the addresses mentioned above, or to any other address duly notified in writing. This Agreement shall be governed by and construed in accordance with the commercial and contractual laws of __________ (country). Signatures: Franchisor: …………………………… Date: … / … / … Franchisee: …………………………… Date: … / … / …