A Franchise Termination Letter is used when either the franchisor wishes to terminate the franchise relationship due to breaches of the franchise agreement, or when mutually agreed termination is desired. This document, governed by Singapore law, serves as the official notification of termination and outlines all necessary steps for both parties. The letter typically references the original franchise agreement, states the grounds for termination, and details post-termination obligations including the cessation of trademark usage, return of proprietary materials, and confidentiality requirements. It's essential to ensure compliance with Singapore's contract law and the Franchising Code of Practice when drafting this document.
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1. Date and Address Block: Formal letter heading with date and recipient details, including reference line
2. Reference to Franchise Agreement: Citation of original franchise agreement including execution date, parties involved, and any subsequent amendments
3. Statement of Termination: Clear and unambiguous statement of intent to terminate the franchise agreement with specific effective date
4. Grounds for Termination: Detailed explanation of reasons for termination with reference to specific clauses in the franchise agreement
5. Immediate Actions Required: Comprehensive list of immediate steps franchisee must take, including cessation of operations and brand usage
6. Post-Termination Obligations: Summary of ongoing obligations after termination including non-compete and confidentiality requirements
1. Outstanding Payments: Section detailing any pending financial obligations, fees, or charges that need to be settled
2. Cure Period: Section specifying time allowed to remedy breaches, if applicable under the franchise agreement
3. Legal Consequences: Section outlining potential legal actions in case of non-compliance with termination requirements
1. Schedule A - Outstanding Obligations: Detailed list of all unfulfilled contractual obligations and required remedial actions
2. Schedule B - Asset Transfer List: Comprehensive inventory of items, equipment, and materials to be returned or transferred
3. Schedule C - Financial Statement: Summary of current financial positions, outstanding amounts, and payment requirements
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