Multi Unit Franchise Agreement Template for Hong Kong

The Multi Unit Franchise Agreement is a sophisticated legal document used in the Hong Kong market when a franchisor grants rights to a franchisee to develop and operate multiple franchise units within a defined territory. This agreement is particularly suitable for established franchise systems looking to expand rapidly through experienced operators capable of managing multiple locations. It includes detailed provisions for unit development schedules, territory rights, operational standards, and financial obligations, all structured within Hong Kong's common law framework. The document addresses both the immediate establishment of the franchise relationship and long-term development obligations, incorporating Hong Kong's business regulations and commercial practices. It's designed to provide comprehensive protection for the franchisor's intellectual property while giving the multi-unit franchisee sufficient operational flexibility to develop their territory effectively.

1. Parties: Identification of franchisor and multi-unit franchisee, including full legal names and registered addresses

2. Background: Context of the agreement, description of the franchise system, and business concept

3. Definitions: Detailed definitions of terms used throughout the agreement

4. Grant of Rights: Scope of franchise rights, territory definition, and exclusivity provisions for multiple units

5. Development Schedule: Timeline and requirements for opening multiple franchise units

6. Term and Renewal: Duration of the agreement and conditions for renewal

7. Fees and Payments: Initial fees, ongoing royalties, development fees, and payment terms for multiple units

8. Obligations of the Franchisor: Support, training, and assistance provided by the franchisor

9. Obligations of the Franchisee: Operational requirements, compliance with systems, and maintenance of standards across units

10. Intellectual Property: Use of trademarks, patents, copyright, and other IP rights

11. Training and Support: Initial and ongoing training requirements for all units

12. Marketing and Advertising: Marketing obligations, advertising fees, and promotional requirements

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

14. Records and Reporting: Financial reporting, audit rights, and record-keeping requirements

15. Transfer and Assignment: Rights and restrictions regarding transfer of the agreement or units

16. Termination: Grounds for termination and consequences

17. Post-Termination Obligations: Obligations after agreement ends, including non-compete and confidentiality

18. Governing Law and Dispute Resolution: Choice of law and dispute resolution mechanisms

19. General Provisions: Standard boilerplate clauses including notices, entire agreement, and amendments