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Sub Franchise Agreement

Sub Franchise Agreement Template for Saudi Arabia

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Key Requirements PROMPT example:

Sub Franchise Agreement

"I need a Sub Franchise Agreement for a luxury retail chain in Saudi Arabia, where our Master Franchisee will grant rights to a Sub-Franchisee to operate 5 stores in Riyadh by March 2025, with strict brand standards and quality control measures."

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Document background
The Sub Franchise Agreement is utilized in multi-tiered franchise systems operating within Saudi Arabia, where a Master Franchisee has been granted rights to sub-franchise a business concept within a specified territory. This document is essential when expanding franchise networks through local operators while maintaining brand consistency and operational standards. The agreement must conform to Saudi Arabia's Commercial Franchising Law introduced in 2020, which requires specific disclosures and compliance with Sharia principles. It typically includes detailed provisions for operational standards, quality control, training requirements, and intellectual property protection. The Sub Franchise Agreement is particularly relevant for international franchise brands entering the Saudi market through local master franchisees, enabling them to establish a compliant legal framework for further expansion while respecting local legal and cultural requirements.
Suggested Sections

1. Parties: Identification of the Master Franchisee (as Sub-Franchisor) and Sub-Franchisee, including full legal names and addresses

2. Background: Context of the agreement, including reference to the Master Franchise Agreement and authority to grant sub-franchises

3. Definitions: Key terms used throughout the agreement, including specific definitions required under Saudi law

4. Grant of Sub-Franchise: Specific rights granted, territorial limitations, and relationship with Master Franchise Agreement

5. Term and Renewal: Duration of the agreement and conditions for renewal, aligned with Master Franchise term

6. Fees and Payments: Financial obligations including initial fees, ongoing royalties, and payment terms

7. Obligations of Sub-Franchisor: Master Franchisee's duties including training, support, and oversight

8. Obligations of Sub-Franchisee: Operational requirements, compliance with system standards, and reporting duties

9. Intellectual Property Rights: Usage rights and restrictions for trademarks, trade secrets, and other IP

10. Quality Control: Standards maintenance, inspection rights, and compliance requirements

11. Confidentiality: Protection of confidential information and trade secrets

12. Non-Competition: Restrictions during and after the agreement term

13. Default and Termination: Breach conditions, remedies, and termination procedures

14. Post-Termination Obligations: Duties and restrictions following agreement end

15. Governing Law and Dispute Resolution: Saudi law application and dispute resolution mechanisms

16. General Provisions: Standard clauses including force majeure, notices, and assignment

Optional Sections

1. Development Schedule: Include when the agreement requires specific timeline for opening multiple locations

2. Training Requirements: Detailed section when extensive training programs are required

3. Marketing and Advertising: Separate section when there are specific marketing requirements or cooperative advertising programs

4. Supply Chain Requirements: Include when there are mandatory supplier relationships or product sourcing requirements

5. Insurance Requirements: Detailed section when specific insurance coverage is mandatory

6. Right of First Refusal: Include when granting pre-emptive rights for additional territories

7. Cross-Default Provisions: Include when linking performance to other agreements within the franchise system

8. Digital Rights and E-Commerce: Include when online operations are significant part of the business

Suggested Schedules

1. Schedule 1 - Territory Definition: Detailed description and/or maps of the granted territory

2. Schedule 2 - Approved Location: Specifications and details of the approved business premises

3. Schedule 3 - Initial Fees and Ongoing Payments: Detailed breakdown of all financial obligations

4. Schedule 4 - Operating Manual Table of Contents: Overview of the confidential operations manual

5. Schedule 5 - Initial Training Program: Details of required initial training

6. Schedule 6 - Equipment and Inventory Requirements: Specifications for required equipment and initial inventory

7. Schedule 7 - Intellectual Property: List of licensed trademarks, patents, and other IP

8. Schedule 8 - Form of Confidentiality Agreement: Template for confidentiality agreements with employees

9. Schedule 9 - Mandatory Insurance Coverage: Required insurance types and coverage levels

10. Schedule 10 - Approved Suppliers: List of approved suppliers and products

Authors

Alex Denne

Head of Growth (Open Source Law) @ tiktok成人版 | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

alex.den.21@genieai.co
Relevant legal definitions



















































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Relevant Industries

Food & Beverage

Retail

Hospitality

Education & Training

Healthcare Services

Automotive Services

Personal Care & Beauty

Fashion & Apparel

Professional Services

Fitness & Recreation

Technology & Electronics

Home Services

Relevant Teams

Legal

Operations

Commercial

Business Development

Compliance

Brand Management

Training & Development

Quality Assurance

Finance

International Development

Relevant Roles

Legal Counsel

Franchise Development Manager

Operations Director

Commercial Director

Chief Executive Officer

Business Development Manager

Compliance Officer

Brand Manager

Territory Manager

Training Manager

Quality Assurance Manager

Finance Director

Regional Development Director

International Expansion Manager

Industries








Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks, 聽Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination, 聽Severance Pay, Governing Law, Entire Agreemen

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