Franchise Sale Agreement Template for New Zealand

The Franchise Sale Agreement is a crucial document used when a business owner (franchisor) grants another party (franchisee) the right to operate a business using their established business system and brand in New Zealand. This comprehensive agreement is essential for protecting both parties' interests and ensuring clear understanding of rights, obligations, and operational requirements. It includes detailed provisions for initial and ongoing fees, territorial rights, training requirements, quality standards, and intellectual property usage. The document must comply with New Zealand's commercial law framework, including the Fair Trading Act 1986 and Contract and Commercial Law Act 2017, as New Zealand doesn't have specific franchise legislation. This agreement typically forms part of a larger suite of franchise documentation, including disclosure statements and operations manuals.

1. Parties: Identification of the franchisor and franchisee, including full legal names, company details, and registered addresses

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

3. Definitions: Comprehensive list of defined terms used throughout the agreement

4. Grant of Franchise: Terms of the franchise license, territory rights, and exclusivity provisions

5. Term and Renewal: Initial term of the franchise agreement and conditions for renewal

6. Fees and Payments: Initial franchise fee, ongoing royalties, marketing contributions, and payment terms

7. Franchisor Obligations: Support, training, and services to be provided by the franchisor

8. Franchisee Obligations: Operating standards, compliance requirements, and performance obligations

9. Intellectual Property: Use of trademarks, trade secrets, and other IP rights

10. Training and Support: Initial and ongoing training requirements and support services

11. Marketing and Advertising: Marketing obligations, cooperative advertising, and use of marketing funds

12. Operations Manual: Reference to and compliance with the operations manual

13. Records and Reporting: Financial record-keeping requirements and reporting obligations

14. Insurance: Required insurance coverage and minimum limits

15. Transfer and Assignment: Conditions for selling or transferring the franchise

16. Termination: Grounds for termination and procedures

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

18. Dispute Resolution: Process for resolving disputes between parties

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