MASTER FRANCHISE AGREEMENT

MASTER FRANCHISE AGREEMENT

BETWEEN

1. ____________________________________________________________________________

(“THE FRANCHISOR”)

AND

2. ____________________________________________________________________________

(“THE MASTER FRANCHISEE”)

THIS AGREEMENT is made on the ………………….day of …………………….20……………by and between the Franchisor, and the Master Franchisee (collectively referred to herein as the “Parties” or individually as the “Party” and includes that party’s successors and assigns.

WHEREAS:

A. The Franchisor, as the result of the expenditure of time, skill, effort and money, has developed and owns a unique and distinctive system (“System”) relating to the establishment and operation of cafes and restaurants that operate under the name______________________________________________.

B. The distinguishing characteristics of the System include, without limitation: uniform and distinctive exterior and interior design and layout, including specially designed decor and furnishings; special recipes and menu items; procedures and techniques for food and beverage preparation and service; automated management information and control systems for inventory controls, cash controls, and sales analysis; technical assistance and training through course instruction and manuals; and advertising and promotional programs. The Franchisor may change, improve and further develop the System from time to time.

C. The Franchisor continues to develop and use (and control the use of) the names, marks, logos, insignias, slogans, emblems, symbols, designs, and indicia of origin (collectively, “Marks”) to identify to the public the source of services and products marketed under the Marks and the System and to represent the System’s high standards of quality, appearance, and service. The Franchisor may modify the Marks used to identify the System, including the principal Marks, from time to time.

D. The Franchisor identifies the System in South East Asia region (Singapore, Indonesia, Malaysia, Vietnam, Thailand, and the Philippines) (“Territory”), using certain trade names, trademarks, logos, and indicia of origin and such other trade names and trademarks as are now designated or may hereafter be designated by [Franchisor] in writing, for use in connection with the System (“Proprietary Marks”);

E. Master Franchisee wishes to obtain the right and license to use the Proprietary Marks and the exclusive right to grant franchises to other persons (“Franchisees”) to establish and operate [franchise business] Centres using the Proprietary Marks and System (“[Franchisor] Centres) in

the Territory, and wishes to receive the training and other assistance provided by [Franchisor] in connection therewith; and

F. Master Franchisee understands and acknowledges the importance of [Franchisor]‘s high standards of quality, appearance, and service, and the necessity of operating the [Franchisor] Centres in conformity with [Franchisor]‘s standards and specifications.

NOW, THEREFORE, the parties agree as follows:

1. GRANT OF MASTER FRANCHISE

The Franchisor hereby grants to the Master Franchisee, and the Master Franchisee hereby accepts, the right during the term to open and operate the Franchised Business and to procure, screen, qualify, train, and assist Master Franchise to open and run the Franchised Business in the Territory, upon the terms and subject to the conditions of this Agreement.

• AGREEMENT TERM

The term of this Agreement will commence upon execution for ten years.

• FEES

The Master Franchisee shall pay to the Franchisor a Master Franchisee fee of ______________________.

The Franchisor shall receive and account for all royalties from all Franchisees and retain its percent ( %) and forward the balance, representing percent (%) of Gross sales, to the Master Franchisee.

•  OBLIGATIONS OF THE PARTIES

The Franchisor

• Grant a license to use and exploit all resources and intellectual property related to the franchised business, e.g its trademark, System of doing business, and selling products;
  •  Allow the Master Franchisee to sell/distribute two types of licenses; a single franchise license (can sell a license to an individual to open one franchise shop in a specific location) and a sub-master franchise license ( can sell to someone and they can distribute single franchise locations where ever they want in a particular region of the city and whichever number they please as the Master Franchisee approves)
  • Provide the master franchisee with the know-how, technical assistance, services, and necessary training to develop, establish and operate the franchise in the terms agreed by the parties;
  • Provide to the master franchisee the materials, manuals, guidelines, and other documents related to the operation of the franchise;
  • Provide the master franchisee a list of equipment, supplies, approved suppliers, list of products, and other materials necessary or required to open and operate the franchised units; and
  • The Franchisor shall not grant third parties the right to operate the franchised business within the Territory during the master franchise agreement.

The Master Franchisee;

4.6. Pay royalties and fees in the amounts and terms agreed by the parties;

4.7. Use the trademarks and any other intellectual property as agreed by the parties;

4.8. Permit the Franchisor to inspect the premises of the franchised units to verify their due operation;

4.9. Attend and comply with all training programs and other related requirements;

4.10. Operate the franchised units exclusively under the proprietary marks of the Franchisor and no other name, in strict conformity with the Franchisor’s standards, manuals, or specifications;

4.11. Maintain the insurance coverages required by the master franchise agreement;

4.12. Participate in any applicable customer loyalty programs, promotions, gift certificates, gift card programs and marketing and advertising and promotional programs or plans; and

4.13. Provide the Franchisor with reports and any information requested by the Franchisor.

4.14. Keep confidential all any information concerning this Agreement unless agreed otherwise by the parties.

4.14. Not to compete with the Franchisor for a defined period of (__________ )upon the termination of the contract.

• NUMBER OF FRANCHISES

The number of franchises/locations that will be opened is dependent on the Master Franchisee’s discretion.

• TRAINING AND ONGOING SUPPORT

The Franchisor shall provide the Master Franchisee with;

5.1. The know-how, technical assistance, services, and necessary training to develop, establish and operate the franchise, in the terms agreed by the parties;

5.2. The materials, manuals, guidelines, and other documents related to the operation of the franchise; and

5.3. A list of equipment, supplies, approved suppliers, list of products, and other materials necessary or required to open and operate the franchised units.

• INSPECTION OF FRANCHISES AND OPERATIONS.

The  Master Franchisee will conduct inspections of all of the Franchises in the Territory, and its operations and the operations of all Master Franchises, per the standards from time to time established by the Franchisor, upon such schedules and according to such procedures as will be agreed upon by the Franchisor and the Master Franchisee, acting in good faith, but, in any event, at least once during each calendar quarter, the Master Franchisee will provide reports to the Franchisor concerning the findings of such inspections, in such form and at such times as the Franchisor will require.

• DISPUTE RESOLUTION

Any dispute under this Agreement shall be resolved through Arbitration. Parties shall act in good faith to resolve the dispute. Nothing in this section shall be interpreted to limit the jurisdiction of the Courts.

• VARIATION TO THE AGREEMENT

Either party may request variations to the Agreement. Variations will only be effective if agreed in writing, signed by all parties, and recorded.

1. FORCE MAJEURE

13.1. For this Agreement, “Force Majeure” means an event which a diligent party could not have reasonably avoided in the circumstances, which is beyond the reasonable control of a party and which makes a party’s performance of its responsibilities hereunder impossible or so impractical as reasonably to be considered impossible in the circumstances and includes, but is not limited to, war, riots, civil disorder, earthquake, storm, flood or adverse weather conditions, strikes, lockouts or other industrial action, terrorist acts, confiscation or any other action by government agencies.

13.2. A Party’s failure to fulfill its obligations due to Force Majeure, to shall not be considered as breach of this Agreement, provided that the affected party has taken all reasonable precautions, due care, and reasonable alternative measures, all to carry out the terms of this Agreement.

13.3. A Party affected by Force Majeure shall take all reasonable measures to remove the inability to fulfill their obligations with minimum delay and minimize the consequence of Force Majeure.

13.4. A Party affected by an event of Force Majeure shall notify the other party in writing of such event as soon as possible, and in any event not later than five (5) days following the occurrence of such event, providing evidence of the nature and cause of such event, and shall similarly give written notice of the restoration of normal conditions as soon as possible.

13.5. Not later than fourteen (14) days after a Party, as a result of Force Majeure, has become unable to discharge its obligations, the Parties shall consult with each other to agree on appropriate measures to be taken in the circumstances.

1. NO WAIVER

Except where this Agreement provides otherwise, the rights and remedies contained in it are cumulative and not exclusive to rights or remedies provided by law.  Failure by either party to enforce any of the terms or conditions of this Agreement shall not be a waiver of their right to enforce the terms and conditions.

1. SEVERABILITY

Suppose any provision of this Agreement is declared by any judicial or other competent body to be void, voidable, illegal, or otherwise unenforceable; parties may amend that provision or severe it from this Agreement. The remaining provisions of this Agreement shall remain in full force and effect.

1. NOTICES

The Parties shall be served through the following addresses (including email) for all purposes arising out of or in connection with this Agreement.

THE FRANCHISOR: ___________________________________________

___________________________________________

___________________________________________

___________________________________________

___________________________________________

___________________________________________

THE MASTER FRANCHISEE: ___________________________________________

___________________________________________

___________________________________________

___________________________________________

___________________________________________

___________________________________________

1. CHANGE OF ADDRESS

Either party may provide changes in the above addressees by reasonable notice in writing given to the other party as aforesaid.

1. COSTS

Each party shall bear its costs incurred in the negotiation, preparation, and execution of this Agreement.

1. GOVERNING LAW

The construction, validity, and performance of this Agreement shall be governed in all respects by the Laws of Hong Kong.

1. TERMINATION

16.1. Either party may terminate this Agreement at any time upon breach of the contract by the other party.

16.2. Either party may terminate this Agreement upon giving the other party no less than 30 days’ notice in writing.

16.3. The termination of this Agreement shall not discharge the liabilities accumulated by either party.

16.4. Any Clauses intended by the Parties or this Agreement to survive the termination of this Agreement shall survive the termination of this Agreement by whatever cause.

16.5. Upon termination, the Master Franchisee should cease using the Franchisor’s trademarks and other intellectual property rights of the Franchisor and must not after that hold itself out as being a Master Franchisee of the Franchisor.

IN WITNESS WHEREOF, each of the Parties has executed this Agreement, all Parties by their duly authorized officer, as of the day and year set forth below.

Signed by the duly authorized representative of the FRANCHISOR Signature: Name: Designation: Date:…………………………………………….…………………

Signed by the duly authorized representative of the MASTER FRANCHISEE Signature: Name: Designation: Date:…………………………………………….………………..