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Franchise Letter Of Intent Template for Singapore

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Key Requirements PROMPT example:

Franchise Letter Of Intent

"I need a Franchise Letter of Intent for my restaurant chain expansion in Singapore, looking to grant exclusive territory rights for the Central Region to a potential franchisee, with a 60-day exclusivity period starting March 2025."

Document background
A Franchise Letter of Intent is commonly used in Singapore when parties are seriously considering entering into a franchise relationship but need to establish preliminary terms before committing to a full franchise agreement. The document typically precedes extensive due diligence and detailed negotiations, serving as a roadmap for the transaction. While Singapore doesn't have specific franchise legislation, the LOI must comply with general commercial law principles and common business practices. It typically includes provisions for confidentiality, exclusivity periods, basic commercial terms, and the timeline for completing the transaction. This document helps parties align their expectations and protect their interests during the negotiation phase.
Suggested Sections

1. Introduction: Identification of parties and basic intent to enter franchise relationship

2. Purpose Statement: Clear statement of intent to negotiate franchise agreement

3. Proposed Terms: Basic outline of key business terms being considered, including proposed business model, territory, and financial terms

4. Due Diligence: Process and requirements for information exchange and evaluation period

5. Timeline: Proposed schedule for negotiations and execution of definitive agreements

6. Confidentiality: Obligations regarding confidential information exchanged during negotiations

7. Binding Effect: Clear statement of which provisions are binding and non-binding

Optional Sections

1. Exclusivity Period: Period during which parties agree not to negotiate with others regarding similar arrangements

2. Deposit Terms: Details of any initial payments or deposits required during the negotiation period

3. Break Fee: Terms regarding compensation if negotiations terminate under specific circumstances

4. Governing Law: Specification of Singapore law as governing law for binding provisions

5. Dispute Resolution: Process for resolving any disputes arising during the negotiation period

Suggested Schedules

1. Initial Business Plan: Preliminary outline of proposed franchise operation and business model

2. Territory Map: Proposed territorial rights and exclusivity zones for the franchise

3. Financial Requirements: Preliminary outline of financial obligations, including estimated investment and fees

4. Timeline Schedule: Detailed timeline for due diligence, negotiations, and execution of definitive agreements

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




















Industries

Contracts Act (Cap. 53): Primary legislation governing contract formation, validity, and enforcement in Singapore. Essential for structuring the LOI's binding and non-binding provisions.

Competition Act (Cap. 50B): Regulates anti-competitive practices and ensures fair market competition. Relevant for territorial restrictions and exclusivity clauses in franchise agreements.

Personal Data Protection Act 2012: Governs the collection, use, and disclosure of personal data. Important for handling customer and franchisee information.

Trade Marks Act (Cap. 332): Protects trademarks and brand elements. Critical for franchise intellectual property protection and licensing provisions.

Copyright Act (Cap. 63): Protects copyrighted materials such as operations manuals, training materials, and marketing content used in the franchise.

Patents Act (Cap. 221): Protects proprietary systems and processes that may be part of the franchise business model.

Companies Act (Cap. 50): Regulates company formation and corporate governance. Relevant for franchise entity structure and compliance requirements.

Business Registration Act (Cap. 32): Governs business registration requirements for franchises operating in Singapore.

Consumer Protection (Fair Trading) Act: Ensures fair trading practices and consumer protection. Relevant for franchise operations and customer interactions.

Employment Act (Cap. 91): Governs employment relationships and workforce management. Important for staffing requirements and employment terms in franchise operations.

FLA Singapore Code of Ethics: Voluntary code of ethics by the Franchising and Licensing Association Singapore, providing best practices for franchise relationships.

Work Pass Regulations: Governs the employment of foreign workers. Relevant for franchises planning to employ foreign staff in Singapore.

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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