The Master Franchise Agreement serves as the foundational document for expanding a franchise system through a master franchisee structure in specified territories. This sophisticated agreement, governed by Swiss law, is typically used when a franchisor wishes to expand their business model into new markets while delegating significant responsibility for territory development to a master franchisee. The document comprehensively covers the grant of rights, development obligations, financial arrangements, operational standards, and sub-franchising requirements. It must comply with Swiss federal laws, particularly the Code of Obligations and competition laws, while addressing international business considerations. The agreement is especially crucial for businesses seeking rapid expansion while maintaining brand consistency and legal compliance across multiple jurisdictions.
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1. Parties: Identification of the contracting parties - the franchisor and master franchisee
2. Background: Context of the agreement, description of the business system, and parties' objectives
3. Definitions: Comprehensive definitions of terms used throughout the agreement
4. Grant of Rights: Scope of master franchise rights, territory definition, and sub-franchising rights
5. Term and Renewal: Initial term of the agreement and conditions for renewal
6. Fees and Payment Terms: Initial fees, ongoing royalties, and payment mechanisms
7. Obligations of the Franchisor: Support, training, and ongoing assistance to be provided by the franchisor
8. Obligations of the Master Franchisee: Development schedule, operational requirements, and sub-franchising obligations
9. Intellectual Property Rights: Usage of trademarks, patents, and system know-how
10. Quality Control: Standards maintenance and compliance requirements
11. Confidentiality: Protection of confidential information and trade secrets
12. Non-Competition: Competition restrictions during and after the agreement term
13. Reporting and Audit Rights: Financial reporting requirements and franchisor's audit rights
14. Default and Termination: Termination events and procedures
15. Post-Termination Obligations: Obligations and restrictions following agreement termination
16. Governing Law and Dispute Resolution: Choice of Swiss law and dispute resolution mechanisms
17. General Provisions: Standard boilerplate clauses including force majeure, notices, and amendments
1. Minimum Performance Requirements: Specific performance targets - include when the franchisor wants to ensure specific growth metrics
2. Sub-Franchisor Operations Manual: Detailed operational procedures for sub-franchising - include for complex systems
3. Insurance Requirements: Specific insurance obligations - include when operating in high-risk industries
4. Data Protection Compliance: Detailed FADP compliance requirements - include when significant personal data processing is involved
5. Import/Export Provisions: International trade requirements - include when products need to be imported
6. Currency and Exchange Rate Provisions: Currency management - include for international payment arrangements
7. Local Adaptation Rights: Rights to adapt the system for local market - include when significant cultural/market differences exist
1. Territory Definition: Detailed description and/or maps of the granted territory
2. Initial Fee and Royalty Structure: Detailed breakdown of all fees and payment terms
3. Development Schedule: Timeline for opening sub-franchised units
4. Trademark Schedule: List of all registered trademarks and usage guidelines
5. Required Equipment and Suppliers: Specifications for required equipment and approved suppliers
6. Training Programs: Details of initial and ongoing training requirements
7. Form of Sub-Franchise Agreement: Template agreement for use with sub-franchisees
8. Quality Control Standards: Detailed operating standards and quality control requirements
9. Confidential Operations Manual Table of Contents: Overview of the operations manual content
10. Reporting Forms: Templates for required periodic reports
Relevant legal definitions
Clauses
Relevant Industries
Retail
Food and Beverage
Hospitality
Personal Services
Business Services
Education and Training
Healthcare Services
Automotive Services
Real Estate Services
Fitness and Wellness
Technology Services
Professional Services
Relevant Teams
Legal
Operations
Finance
Business Development
Compliance
International Development
Commercial
Risk Management
Brand Management
Training and Development
Relevant Roles
Chief Executive Officer
Chief Legal Officer
Chief Operating Officer
Chief Financial Officer
Franchise Development Director
Legal Counsel
Commercial Director
Business Development Manager
Operations Director
Franchise Manager
Network Development Manager
Compliance Officer
International Business Director
Territory Manager
Contract Manager
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