Oregon Franchise Forms - Oregon Franchise Law

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Oregon Franchise Forms FAQ

What is a franchise?

There is a definition of a franchise which has been developed by the Federal Trade Commission. Basically, a franchise involves an owner of a trademark, trade name and/or copyright giving others a license under certain conditions to use these trademarks, trade names or copyrights in providing goods or services to the public. The franchisor is the party who grants the franchise, and the franchisee is the party who receives the franchise.

What is the legal relationship between a franchisor and franchisee?

Technically, the relationship between a franchisor and franchisee is a relationship between two independent contractors. Their rights are determined by the franchise agreement. A franchise then is not a separate business entity, but is a business relationship between two separate business organizations such as a sole proprietorship, a corporation, or a partnership. The relationship between the franchisor and franchisee is controlled by the franchise contract. A corporation, sole proprietorship, or partnership may own the franchise contract or may be the entity entering into the franchise contract.

What laws govern franchises?

There are laws that restrict termination of some franchises. In some states, prior notice of termination is required. Owners of automobile dealership franchises are protected from termination of their dealerships in bad faith. This protection is provided by the Federal Automobile Dealers Franchise Act.


What are Articles of Incorporation?

Articles of Incorporation are legal documents that a business entity must file with the state government to establish itself as a corporation. In simple terms, they are like a birth certificate for a corporation, outlining its basic information and purpose. In the state of Oregon, the Articles of Incorporation need to include the corporation's name, address, purpose, and the names of its initial directors. These documents are important because they create a separate legal entity for the corporation, providing limited liability protection to its owners and establishing its legal rights and obligations.


What to Include in Articles of Incorporation

When creating the Articles of Incorporation in Oregon, there are a few important things that you need to include. Firstly, you should clearly state the name of your corporation and its purpose, explaining what the company aims to achieve. It is also crucial to mention the company's duration, or how long it will exist. Additionally, you must include information about the registered agent, who will act as the point of contact for legal matters. It is essential to provide the corporation's principal office address, along with the names and addresses of the initial directors. Lastly, don't forget to include the total number of shares your corporation is authorized to issue and any restrictions on their transferability. These elements are key points to include in the Articles of Incorporation, as they form the foundation of your corporation in Oregon.


1. Full Name of Corporation

The full name of the corporation is a unique and official title that represents a business entity in Oregon. It is the complete name under which the company is registered and recognized by the state. Adding "+ in Oregon" clarifies that the corporation is situated in the state of Oregon specifically. The corporation's name is important for legal and administrative purposes, as it helps identify and distinguish the business from others. Using simple human words and stating phrases allows for a clearer understanding of what the corporation is and where it operates.


2. Principal Place of Business

The Principal Place of Business refers to the main location where a company conducts its main operations, manages its affairs, and makes significant decisions. In Oregon, this is the primary physical location from where a business operates, usually where its headquarters are situated. It serves as the central hub for day-to-day activities, such as managing employees, coordinating production or services, and interacting with customers or clients. The Principal Place of Business in Oregon is critical for establishing a company's presence in the state and complying with local regulations.


12. Limitation of Director’s Liability

In Oregon, there are certain limitations on the liability of directors. This means that directors of a company are not personally responsible for every mistake or liability of the company. Instead, they are only held accountable for their own wrongful acts or decisions that directly result in harm or loss to the company or its shareholders. This limitation helps protect directors from being unfairly burdened with excessive liability and encourages them to take reasonable risks in the best interest of the company's success.