Franchise Agreement (Type II)

Updated atMarch 2010

This AGREEMENT ............, 200..


________________ Ltd. whose office is at....................; ____________ Pvt. Ltd. whose office is at.................... (hereinafter collectively referred to as "the Franchisor")


............................ (hereinafter called "the Franchisee" which expression shall unless repugnant to the context or meaning thereof, include its heirs, legal representatives, executors, administrators, successors and permitted assigns).


  1. _________ has developed a business operating under the style _______ in the course of which the Franchisor inter alia:

    (a) manufactures, distributes and sells by wholesale and retail the Products;

    (b) operates a network of high quality comprehensive and distinctively designed retail outlets to sell the Products;

    (c) has the technical expertise and know-how to operate ______ to provide _________ based on the Methods;

  2. __________________ Pvt. Ltd. has expended time, effort and money to develop and acquire knowledge and expertise with regard to the business of manufacturing and marketing __________ and constantly endeavours to improve its exclusive range of Products and Services;

  3. ___________ Pvt. Ltd. is one of the group-company _________ Pvt. Ltd. and owns the Trademarks in ____________.

  4. That substantial reputation and goodwill has accrued upon the Franchisor''s business under the Trademarks and has resulted in substantial demand for its Products and Services;

  5. The Franchisee owns and runs the ________ in......................... and is desirous of opening an ______________;

  6. The Franchisee being desirous of obtaining the benefits of the Franchisor''s knowledge, expertise and goodwill and the demand for the Products and Services, has requested the Franchisor to grant to the Franchisee the right to establish and operate an ____________ to provide Services and a retail outlet to sell the Products at the Location (hereinafter referred to as "the Project");

    1. Definitions

      Commencement Date shall be:

      Confidential Information shall mean all information or data disclosed (whether in writing, orally or by any other means) by the Franchisor to the Franchisee, and shall include but not be limited to (A) any information ascertainable by the inspection or analysis of the products, (B) any information relating to the Franchisor''s business operations, processes, plans, intentions, product information, know-how, trade secrets, market opportunities, customers and business affairs.

      Intellectual Property Rights shall include all rights in existing and future Intellectual Property in the nature of registered and unregistered rights to any and all tradenames, trademarks, patents, copyrights, Confidential Information, designs, know-how, business methods, ideas, strategies, database rights and all other Intellectual and Industrial Property rights of any sort (throughout the world), as well as moral rights and similar rights of any type under the laws of any governmental authority, domestic or foreign".

      Location shall mean the premises of ________________ at.................... (Name of the Place).

      Method shall mean the methods, techniques and processes developed by the Franchisor;

      Trademarks shall mean the names, trademarks and service marks owned by the Franchisor and include inter alia;

      Products shall mean the __________________________goods of the Franchisor bearing any of the Trademarks;

      Services shall include the range of "specialized treatments" based on the Method.

      Term shall mean the period of twenty years from the Commencement Date; Turnover shall mean gross revenue of the ________________

    2. Grant of Franchise

      In consideration of the onetime professional consultancy fees and the other payments, which shall be paid by the Franchisee at the time and in the manner set out in this Agreement and in further consideration of the observance and performance of the undertakings on the part of the Franchisee, the Franchisor grants to the Franchisee the right to establish and operate the _____________ and the Retail Outlet at the Location for the Term.

    3. Franchisee''s Obligations

      The Franchisee covenants and agrees with the Franchisor promptly to perform and observe the following covenants and conditions:

      3.1 Commencement

      To commence the Project by the Commencement Date.

      3.2 Project not to be carried on other than from the Location

      Not to carry on the Project or any part thereof other than from the Location without the prior written consent of the Franchisor.

      3.5 Promote Business

      3.5.1 Actively to promote the Project and to exercise best endeavours in the conduct of the Project to promote the mutual business interests of the Franchisor and the Franchisee and shall cause to be provided at the Location such of the Products as are stipulated by the Franchisor from time to time.

      3.5.2 As part of its endeavours to promote the Project, to organize a Media Conference at the time of launch and to organize such other promotional activities including but not limited to media promotions, brochure drops and on-location merchandising display as are mutually decided by the Parties from time to time.

      3.6 Products

      3.6.1 Only to sell at the Location, the Products, which are specified by the Franchisor and which may be purchased from the Franchisor alone.

      3.6.2 In no case will the Franchisee stock or sell any goods other than the Products and goods which the Franchisor otherwise deems to be unsuitable for sale at the Location.

      3.6.3 The Franchisee shall pay for all Products acquired by him from the Franchisor according to the terms of payment as notified in writing from time to time by the Franchisor to the Franchisee.

      3.6.4 Notwithstanding that risk in any Products supplied by the Franchisor to the Franchisee, shall pass to the Franchisee upon delivery, full legal and equitable title and interest in all and any Products supplied to the Franchisee shall remain in the Franchisor and shall not pass to the Franchisee until the Franchisor shall have received payment in full of all amounts due and owing from the Franchisee to the Franchisor for the time being (including any interest accruing and owing to the Franchisor) and from time to time in respect of all such Products supplied by the Franchisor to the Franchisee at any time.

      3.6.5 The Franchisee shall pay the cost of delivery for the Products acquired from the Franchisor.

      3.7 Not to tamper with products

      To sell the Products in the same condition as that in which it receives them and not to alter or remove or tamper with them or any markings or name plates or indications of the source of origin on them or any packaging supplied by the Franchisor except putting such notices as are...

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