The Franchise Letter of Intent is a crucial preliminary document used in the early stages of franchise negotiations in Switzerland. It serves as a roadmap for the parties to outline their initial understanding and expectations before committing to a full franchise agreement. While Switzerland doesn't have specific franchise laws, this document operates within the framework of the Swiss Code of Obligations and related commercial laws. The LOI typically precedes the due diligence phase and helps establish clear parameters for negotiations, including exclusivity periods and confidentiality obligations. It's particularly important in the Swiss business context where precision and clarity in pre-contractual dealings are highly valued. The document helps parties align their expectations while maintaining flexibility for detailed negotiations, making it an essential tool in franchise business development.
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1. Date and Parties: Identification of both parties with full legal names, addresses, and registration details
2. Introduction: Brief statement of intent to explore a franchise relationship
3. Business Concept: Overview of the franchise business model and broad scope of the proposed relationship
4. Key Commercial Terms: Outline of principal commercial terms to be negotiated, including territory, fees, and duration
5. Due Diligence Process: Framework for information exchange and evaluation process
6. Timeline: Proposed schedule for negotiations and key milestones
7. Exclusivity: Terms of exclusive negotiation period if applicable
8. Confidentiality: Basic confidentiality obligations regarding shared information
9. Non-Binding Nature: Clear statement that the LOI is non-binding except for specified clauses
10. Costs: Each party's responsibility for their own costs during negotiations
11. Governing Law: Confirmation of Swiss law as governing law
12. Signatures: Execution blocks for both parties
1. Break Fee: Include when parties want to establish compensation if one party terminates negotiations without justified cause
2. Binding Provisions: Detailed section specifying which provisions are legally binding, useful for complex negotiations
3. Interim Operations: Include when specific arrangements are needed during the negotiation period
4. Public Announcements: Add when either party may need to make public statements about the potential franchise relationship
5. Extension Mechanism: Include when parties want to specify how the LOI term can be extended
6. Dispute Resolution: Add when parties want to specify detailed dispute resolution procedures for the LOI period
1. Initial Business Plan Overview: High-level summary of proposed business structure and financial projections
2. Due Diligence Checklist: List of required documents and information for evaluation
3. Proposed Timeline: Detailed schedule of negotiation milestones and deadlines
4. Territory Map: Visual representation of proposed franchise territory
5. Key Commercial Terms Sheet: Detailed outline of main commercial terms to be negotiated
Authors
Relevant legal definitions
Clauses
Relevant Industries
Retail
Food & Beverage
Hospitality
Education & Training
Healthcare Services
Fitness & Wellness
Professional Services
Automotive
Real Estate
Technology & Software
Fashion & Apparel
Personal Services
Relevant Teams
Legal
Commercial
Business Development
Operations
Corporate Development
Strategy
Finance
International Expansion
Mergers & Acquisitions
Franchise Operations
Relevant Roles
Chief Executive Officer
Chief Operating Officer
Franchise Development Manager
Business Development Director
Legal Counsel
Commercial Director
Head of Expansion
Franchise Operations Manager
Business Owner
Managing Director
General Counsel
Corporate Development Manager
Investment Manager
Strategy Director
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