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Sub Franchise Agreement Template for Australia

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Key Requirements PROMPT example:

Sub Franchise Agreement

"I need a Sub Franchise Agreement for my national fitness center chain, allowing my master franchisee in Queensland to grant sub-franchises, with specific requirements for equipment standards and trainer certifications, planned to commence from March 2025."

Document background
The Sub Franchise Agreement is a critical document used in multi-tiered franchise systems operating within the Australian jurisdiction. It's implemented when a master franchisee, who holds rights to a broader territory or region, grants individual franchise rights to sub-franchisees. The agreement must strictly comply with the Australian Franchising Code of Conduct and related legislation, including the Competition and Consumer Act 2010. This document outlines all essential aspects of the franchise relationship, including operational requirements, territory rights, fee structures, intellectual property usage, and performance standards. It's particularly important as it needs to balance the interests of three parties - the master franchisor, master franchisee (sub-franchisor), and sub-franchisee - while maintaining consistency with the master franchise agreement and protecting the overall franchise system's integrity.
Suggested Sections

1. Parties: Identifies the master franchisor, master franchisee (sub-franchisor), and sub-franchisee

2. Background: Explains the franchise system, master franchise arrangement, and context for the sub-franchise agreement

3. Definitions and Interpretation: Defines key terms and establishes interpretation principles

4. Grant of Sub-Franchise: Details the rights granted to the sub-franchisee and territory allocation

5. Term and Renewal: Specifies initial term, renewal conditions, and processes

6. Fees and Payments: Outlines all fees, royalties, and payment terms

7. Obligations of the Sub-Franchisee: Lists all operational, financial, and compliance obligations

8. Training and Support: Details initial and ongoing training requirements and support services

9. Intellectual Property: Covers usage rights and restrictions for trademarks, systems, and materials

10. Operations Manual: References the manual and compliance requirements

11. Marketing and Advertising: Specifies marketing obligations, fees, and approval processes

12. Records and Reporting: Details required business records, reports, and audit rights

13. Insurance: Specifies required insurance coverage and limits

14. Transfer Provisions: Outlines conditions and processes for transfer of the business

15. Termination: Details grounds and processes for termination

16. Post-Termination Obligations: Specifies obligations after agreement ends

17. Restraint of Trade: Non-compete and confidentiality provisions

18. Dispute Resolution: Processes for handling disputes as per Code requirements

19. Warranties and Representations: States warranties given by all parties

20. General Provisions: Includes standard boilerplate clauses

Optional Sections

1. Premises: Required if the franchise operates from specific premises - includes lease terms and requirements

2. Equipment and Fitout: Required if specific equipment or store fitout is necessary

3. Supply Arrangements: Include if there are mandatory supplier relationships or product requirements

4. Online Operations: Required if the franchise includes online business components

5. Multiple Unit Rights: Include if sub-franchisee has rights to operate multiple units

6. Development Schedule: Required if the sub-franchisee must open multiple units over time

7. Employee Requirements: Include if there are specific staffing requirements or restrictions

8. Local Area Marketing: Required if specific local marketing obligations exist

9. Master Franchisor Direct Rights: Include specific provisions for master franchisor to act directly with sub-franchisee

Suggested Schedules

1. Schedule 1 - Business Details: Key business information, territory definition, commencement date

2. Schedule 2 - Fees and Payments: Detailed fee structure, calculation methods, payment terms

3. Schedule 3 - Intellectual Property: List of trademarks, copyrights, and other IP rights

4. Schedule 4 - Initial Training Program: Training requirements, duration, and content

5. Schedule 5 - Equipment and Inventory Requirements: Required equipment, specifications, approved suppliers

6. Schedule 6 - Key Performance Indicators: Performance standards and metrics

7. Schedule 7 - Approved Products and Services: List of authorized products/services and specifications

8. Schedule 8 - Reporting Requirements: Forms, frequency, and content of required reports

9. Appendix A - Guarantee and Indemnity: Personal guarantees from sub-franchisee principals

10. Appendix B - Deed of Restraint: Detailed non-compete provisions

11. Appendix C - Direct Debit Authority: Banking and payment authorization forms

Authors

Alex Denne

Head of Growth (Open Source Law) @ tiktok³ÉÈ˰æ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions


















































Clauses

















































Relevant Industries

Retail

Food and Beverage

Professional Services

Healthcare

Education and Training

Automotive

Cleaning Services

Real Estate

Personal Services

Home Services

Fitness and Recreation

Technology Services

Business Services

Hospitality

Relevant Teams

Legal

Operations

Finance

Business Development

Compliance

Training and Development

Property Management

Brand Management

Commercial

Risk Management

Relevant Roles

Chief Executive Officer

Chief Legal Officer

Franchise Development Manager

Legal Counsel

Operations Director

Franchise Operations Manager

Business Development Manager

Compliance Officer

Territory Manager

Commercial Director

Chief Financial Officer

Training Manager

Property Manager

Brand Manager

Contract Administrator

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,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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