This is a master franchise agreement. The form grants franchise rights to a subfranchisor to operate restaurants and to procure, screen, qualify, train, and assist subfranchisees of the restaurant.
Hawaii Master Franchise Agreement
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With a proper grasp of the three conditions of a franchise agreement ? terms, rights and obligations, and termination ? parties can confidently enter into a full franchising agreement or partnership, knowing their individual and collective interests are protected by a legally binding contract.
The standard would be 50/50, but this will vary depending on roles and responsibilities. For example, if the master franchisee is doing less training and support, you as the franchisor may keep 70% of the royalty fees and pay the master 30%.
Franchise agreements vary between different franchises, but these seven areas should be addressed in every franchise agreement. Use of Trademarks. Location of the Franchise. Term of the Franchise. Franchisee's Fees and Other Payments. Obligations and Duties of the Franchisor. Restriction on Goods and Services Offered.
The key elements of a franchise agreement generally include: Territory rights. ... Minimum performance standards. ... Franchisors services requirements. ... Franchisee payments. ... Trademark use. ... Advertising standards. ... Exclusivity clause. ... Insurance requirements.
TYPES OF FRANCHISE ARRANGEMENTS Single Unit Franchise. Single Unit Franchise (or Direct Unit Franchise) is the most traditional and historically the most common form of franchising. ... Multi Unit Franchise. ... Area Development Franchise. ... Master Franchise.
Under a master franchise agreement, the master franchisor grants to the master franchisee a specified area where the master franchisee has the right not only to open franchise units itself, but also to ?sub-franchise? to third parties.
Business Format Franchise Many well-known franchises like McDonald's, Starbucks, and Subway use the business format type of franchising. With this type, franchisees will pay fees to use the trademark, products, and services exclusively held by the franchisor.
If you want to become a master franchisee, you must sign a master franchise agreement and pay a fee. In exchange, you receive the rights to sell units on behalf of the franchisor and receive a percentage of the franchise fee and royalties that your franchisees pay. There are several different master franchise models.