Franchise Documents. Home

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1 Franchise Documents Home Following are sample table of contents for a Franchise Disclosure Document (FDD), Franchise Agreement, and Operating- Marketing Manual: Franchise Disclosure Document Item 1. Item 2. Item 3. Item 4. Item 5. Item 6. Item 7. Item 8. Item 9. Item 10. Item 11. Item 12. Item 13. Item 14. Item 15. Item 16. Item 17. Item 18. Item 19. Item 20. Item 21. Item 22. Item 23. The Franchisor, and Any Parents, Predecessors and Affiliates.. Business Experience.. Litigation... Bankruptcy... Initial Fees. Other Fees Estimated Initial Investment... Restrictions on Sources of Products and Services Franchisee s Obligations Financing.. Franchisor s Assistance, Advertising, Computer Systems and Training Territory. Trademarks... Patents, Copyrights and Proprietary Information Obligation to Participate in the Operation of the Franchised Business.. Restrictions on What the Franchisee May Sell... Renewal, Termination, Transfer and Dispute Resolution. Public Figures... Financial Performance Representations.. Outlets and Franchisee Information. Financial Statements.. Contracts... Receipt... Page Attachments: A. Financial Statements.. A-1 B. Franchise Agreement... B-1 C. List of Current and Former C-1 Franchisees.. D. Manual Table of Contents.. D-1 E. Our Agent for Service of Process. E-1 F. State Agencies. F-1 G. State Law Addendum. G-1

2 H. Franchise Application. H-1 Franchise Agreement Article 1 License and System. Page 1.01 Grant of License 1.02 Location and Territory Licensed Business 1.04 System and Marks 1.05 Manual Article 2 Franchise Fees and Advertising Initial Fee 2.02 Royalties Franchisor Marketing Fee Management Assistance Gross Revenues Local and Cooperative Marketing.. Article 3 Reports and Audits Records and Reports Failure to Report Audits and Inspections Contact with Others.. Article 4 Training Initial Training 4.02 Manager Training Employee Training 4.04 Subsequent Training 4.05 Training Materials No Warranty of Success.. Article 5 Trade Secrets and Confidentiality.. Article 6 Pre-Opening Obligations Premises Specifications Required Equipment Required Training.

3 Article 7 Operation of Licensed Business Independent Contractor Personal Participation Retail Prices Compliance with Laws Franchisee Business Operation Restrictions on Sources of Products and Services Minimum Office Hours Computer System Communications Equipment and Systems Equipment Maintenance Warranties No Pirating of Personnel Marketing 7.14 Leads and Service Area New Developments Staffing Requirements.. Article 8 Indemnity and Insurance Indemnity 8.02 Insurance Article 9 Renewal Conditions of Renewal. Article 10 Continuation. Article 11 Entity Franchise Entity Definition Founding Documentation Restriction Liability of Owner(s) Restriction on Certificates of Ownership Additional Requirements of Entity Franchise... Article 12 Assignment or Transfer Prior Consent Conditions of Assignment Assignment to an Entity Approval Process Transfer by Franchisor No Sublicensing

4 Article 13 Death or Incapacity Alternatives Upon Death or Incapacity Effect of Failure to Comply Incapacity Defined Article 14 Successors and Assigns Article 15 Termination.. Article 16 Competition with Franchisor Competing Business Activities During Term Competing Business Activities After Term Article 17 Effect of Termination Loss of Rights Change of Identity Changeover Procedure Continuing Royalties Option to Purchase Certain Assets Payment and Terms Survival of Terms.. Article 18 Release from Franchisee Obligations Release from Continuing Obligations Article 19 Arbitration of Disputes Agreement to Arbitrate Conduct of Arbitration Conditions Precedent to Arbitration Limited Exceptions to Arbitration and Mediation. Article 20 Representations of Franchisee Representations Article 21 Miscellaneous Provisions Nonwaiver Attorneys Fees Severability.

5 21.04 Warranty of Authority Estoppel Certificate Paragraph Headings Recitals No Third Party Beneficiary Choice of Law Notices Entire Agreement Modification Effective Date Time of Essence Article 22 Business Risk No Promises Receipt for Disclosure Document... Exhibits Location of Licensed Business.. Territory.. Required Equipment Items Subject to Specifications.. Personal Guarantee. Trade Secrets and Confidentiality Agreement. Mutual Termination of Franchise Agreement and Release... Consent, Waiver and Release for Training.. Release from Continuing Obligations Confidentiality Agreement Additional Information

6 Operating Manual Chapter 1: Introduction... Page How to Use This Manual. Confidential Disclosure Agreements. Chapter 2: Welcome to ABC Services. History of ABC Services.. The ABC Service Management Team.. Legal Advisory and Franchisor s Management Support ABC Service Mission Principles and Promises... Chapter 3: Support Resources. Franchise Support Matrix Franchise Corporate Officers. Chapter 4: Franchisee Training Requirements.. ABC Services Pre-Opening Timetable. Week One.. Week Two.. Week Three... Week Four. Week Five.. Week Six Week Seven.. Chapter 5: Franchisee Training Requirements.. ABC Services Orientation Training Chapter 6: Staffing Your Services Franchise. Staffing your ABC Services Franchise.. Position Descriptions with Profiles. Chapter 7: Office Policies.. Setting Up Your Office. Quality Standards of Service..

7 Service and Courtesy to Clients. Handling Typical Complaints and Problems Employee Appearance and Hygiene. Computer Usage.. Chapter 8: Office Operation and Maintenance Opening Procedures Closing Procedures.. Miscellaneous Franchise Duties and Responsibilities Office Administration Major Activities Listing... Administrative Management Checklist.. Alarms, Locks and Keys.. Chapter 9: Office Equipment, Computer System, Inventory, and Supplies... Office Equipment.. Approved Vendors Chapter 10: Administration Record Keeping Accounting Services Collections and Accounts Receivable Management.. Chapter 11: Reports, Audits and Inspections. Franchise Reports Failure to Report... Audits and Inspections Contact with Others. Chapter 12: Marketing FCS Field Collection Services Franchisee Marketing Requirements.. Target Marketing with Selected Media. Executing Your Marketing Plan.. Chapter 13: Sales Introduction. Phone Selling. Referrals. Chapter 14: Insurance Requirements and Risk Management.

8 General Insurance Coverage.. Risk Management. Managing Risk at the Franchise Location or Job Site. Franchise Site Security Reporting Incidents... Chapter 15: Corporate Structure... Setting Up Your Entity.. Legal Business Structures... Types of Structures.. Setting Up the New Corporation. Financing Arrangements.. Financing Alternatives.. Chapter 16: Trademarks and Trade Secrets Protection Policies. Patents, Copyrights, and Proprietary Information Trademark Usage and Guidelines. Examples of Trademark Misuse. Chapter 17: Field Operations Safety in the Field. Outline of the Field Chase Process Chapter 18: Resale, Transfer, Renewal and Closing. Conditions of Renewal. Continuation... Assignment or Transfer Termination. Chapter 19: Expansion and Relocation Requirements.. Franchise Expansion, New Territory, Resale Purchase or Territory Expansion. MICHAEL T. CHULAK & ASSOCIATES A LAW CORPORATION Corporate Office Canwood Street, Suite 203 (818)

9 Agoura Hills, CA (800) Regional Office 1055 E. Colorado Blvd., 5 th Floor (626) Pasadena, CA (888) Satellite Offices Santa Clarita Valley Ontario Orange County Los Angeles Santa Barbara By Appointment

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