Franchise Agreement

 Franchise Agreement

On…………. dated…. /…. /2020, an agreement has been made by and between:  –

First: (Company) Gram Coffee Trading L.L.C. with its registered office No, 01-7 off located in Dubai, UAE, CR No. ………………issued on date …/…. /2020 from………..; Owner: Saaied Muhammed Dahi Saaied Al Muhairi , represented by Mr./………….. In his capacity as the company director, and is of …………nationality.

Corresponding e-mail address:  ……………………………….

(First Party: Franchisor)

2. Company/.…………………. with its registered office …………… Cairo, Republic of Egypt, CR No. ……….. On date of …./…./2010 issued from Cairo, Republic of Egypt and it is a limited liability company according to Egyptian company law. It is represented by Mr./………….. in his capacity as the company director, and is of …………nationality.

Corresponding e-mail address:……………………………….

(Second Party: Franchisee)

Preamble

– Whereas both parties desire to create a business relationship between them in order to serve their mutual interests and to determine their respective rights and obligations towards each other. – Whereas the first party, the Franchisor, bear the trade name of Gram Coffee Trading and the “trade mark” as described in the appendix (1) attached hereto. The franchise-granting company works in field of coffee trading in UAE; it has been and still exert money and effort to develop and improve the company mentioned herein and seeks to obtain the greatest financial and marketing gains by opening many branches carry its trade name and trade mark in different areas and countries. Hereby the First party desires to expand its business inside and outside UAE, and the Second party, the franchisee, desire to establish a subsidiary of Gram Coffee Trading and to use its trade name and Trademark at ……………………  (Territory) mentioned its outlines and borders in Appendix (1) attached hereto under the name of “Trade Name and Trade Mark of the First Party the Franchisor” Whereas both parties desire to create business relationship with each other,that is compatible with the related legal requirements determined in Territory, to serve their common interests as well as to determine their respective rights and obligations towards each other in accordance to the norms of conduct.  Therefore, both parties with their full legal capacities have agreed upon the following: –

First: Definitions and General Provisions 

1-The Above Preamble shall be part and parcel of this agreement.

2- Definitions The following terms wherever mentioned in this agreement shall have the meaning hereby assigned to them: – 

A- Franchisor:  Company/……………  In the United Arab Emirates

And Located in Emirate…………… Telephone: ………. Fax: ……………

B- Franchisee Company/…………….

C- Trading Name: …………………….is the trading name of Franchisor

D- Trademark It is the trademark of Franchisor and its products as described in Appendix (2) attached hereto.

E- Territory:  ……………………… – Republic of Egypt.

F- Franchise store:  It is the store of the second party (the franchisee) and its boundaries and features shall have been shown through Appendix No. (3) attached to this agreement.

G- Operating evidence: It is the written evidence that contains a detailed method for preparing coffee for the name and trademark of the first franchisor.

3- According to this agreement, the franchisor shall allow the franchisee to use his name and trademark in the territory.

4- Term of this agreement shall be four Gregorian years, unless one of the partners informs the other partner of his unwillingness to renew at least six months before the end of the valid period by certified mail or by e-mail specified at the issuance of this contract. 

5- Addition, deletion, modification and termination: Any of the provisions of this agreement or its appendices shall not be added, deleted, modified or terminated except under an additional contract signed by the two parties.

6- Communication: All communication related to the implementation of this agreement or any of its provisions shall be in writing, and shall be sent by fax or e-mail to the addresses of the two parties indicated in this contract, provided that there is a receipt for that.

Second:  Franchisee obligations

1- Upon signing this contract, the franchisor shall obligate to pay a cash amount of USD 10,000 (Ten thousand USA dollars) as a security amount for the obligations included on the franchisee in this contract, and this contract shall return upon the contract term shall expire, after making sure that the second party shall have fulfill all its obligations.  Including and resulting from this contract.  Pay the franchisor’s fee, which shall estimate at an amount……………. USD One thousand monthly, and he shall pay it to the franchisor by bank transfer in USD to the bank account NO…………………. at the bank ……………….. – In the United Arab Emirates.

The second party shall obligate to pay an amount of USD 25,000 (twenty-five thousand American dollars) against the second party’s exploitation and use of the name and trademark of the first party Gram Coffee, and that amount shall pay as follows: –

An amount of USD 12,500 (twelve thousand five hundred USA dollars) shall be pay upon the two parties sign this contract, provided that the amount of USD 12,500 (twelve thousand five hundred USA dollars) shall be pay 60 days after this contract shall enter.

2- The franchisee shall obligate to inform the franchisor immediately of all infringements or traditions on his name and trademark, or about any person or store who appears to be “Gram Coffee Company” that may bring to his attention

3- The franchisee shall obligate to due diligence at the franchisor`s store, and shall not to do any act that harms the name or the trademark of the franchisor.

3- The franchisee shall obligate to follow all the technical requirements agreed upon in the appendix of the contract No. 3, which shows the external appearance of the name and the trademark (external Advertising Signs of the franchise store) in addition to the interior decoration and the general appearance of the franchise store

5

 – The second party (the franchisee) shall obligate by the uniform of the first party (the franchisor) and attached to the appendix Contract No. 4 of this contract.

6 – The second party (the franchisee) shall obligate to present the coffee in packages with the name and trademark of the first party (the franchisor) printed on it.

7- The second party (the franchisee) shall obligate by the technical conditions and specifications for the products and materials used in production according to the contract annex No. 5.

8 – The second party (the franchisee) shall obligate by the conditions and specifications of the equipment and machinery used in the preparation of beverages, annex No. 6.

9 – The second party (the franchisee) shall obligate to insure workers and employees working at the franchisor`s store and to provide their own places for sleeping or rest.

10- The second party (the franchisee) shall obligate by the prices of the products provided at the franchise store, which are specified in the contract annex No. 7.

11 – The second party (the franchisee) shall obligate to give the first party a certified copy of the tax declarations and budgets of the franchise store at the end of December of each year.

12 – The second party (the franchisee) shall obligate all necessary permits and licenses to operate the franchise store within 6 calendar months from the date of signing this contract.

13- the second party (franchisee) shall obligate to spend 3% of the total monthly sales value on the advertising and marketing work of the name and brand owned by the first party (franchisor).

Fourth: Common obligations and rights

1- Given that the contracts are based only on the principle of good faith in dealing, the two parties shall be committed through this agreement to implement what came in it and its appendices in accordance with the business practice in accordance with that principle, and the two parties also shall be committed to maintain the confidentiality of negotiations, contractual arrangements, and financial and technical details throughout the duration of its validity.

2- The franchisor shall have the right to transfer all its rights and obligations under this agreement to any other person, company or institution, provided that the designated person shall be able to fulfill obligations towards the franchisee as stipulated in this agreement.

3- The franchisee shall have the right to transfer or sell this Agreement to a third party after obtaining written consent from the franchisee ‘s company, provided that the designated person shall be able to fulfill obligations towards the franchisor as stipulated in this agreement.

4- The franchisee shall not have the right to open the franchise outlets in the concession area, whether in the district, city, governorate, state or kingdom, except after obtaining written approval from the franchisor’s company.

5- The second party shall provide the headquarters where the processing, production and distribution of coffee and work practice through personal computer with the help of skills and expertise of the first party.

6- The second party shall pay to the first party commission of …………………… of the value of sold items in the contract area.

7- The parties shall agree that the second party as franchisee on behalf of the first party, to choose the locations of stores that sell and supply coffee and process it besides carrying out the services that are the subject of the contract in his/ her name and for his/her personal account.

9- The first party (franchisor) shall have the right to supervise and follow up the work in the franchise outlet by anyone authorized to follow-up and supervise the proper progress of work as agreed upon in the terms of this contract.

Fifth: Guarantee

– The franchisee shall sell beverages at the franchise outlet at the same prices agreed upon with the first party (franchisor) and specified in the contract annex No. 7.

– The parties of the contract shall agree that the franchisor is not responsible for any financial benefits that may arise for others for the franchise outlet or for the benefit of the workers who work for it.

Sixth:  Termination, Cancellation of Agreement and indemnification

1- This agreement terminates by the end of term mentioned herein or in event the first party and/or second party are no longer able to carry out this agreement.

2- If one of the parties terminate or revoke this agreement in inconvenient time or for illegal reasons; the matter which may cause ham or loss to the other party, the party that causes this harm or loss shall indemnify the other party for this harm or loss.

3- In conformity with above mentioned paragraph, the franchisee has the right to request the franchisor indemnification for harms incurred according to this agreement and business practice in the following events: –

A‌- If the franchisor terminates or revoke this agreement in inconvenient time and for reason beyond the control of the franchisor.

B‌- If the franchisor refuses to renew this agreement after its expiration date and the franchisee work has resulted in success in respect of developing the trade name and the trademark of the franchisor in the determined territory; thus the non-renewal of this agreement is considered as a missing opportunity as being the source of profit, development and success. Therefore, the franchisor shall indemnify the franchisee for the effort exerted, the moral and material resources provided in order to achieve such success.

4- Without prejudice to the last two paragraphs, in case of termination of this agreement, the franchisor shall permit the franchisee to use the trade name and the trademark in the territory to the limit allows the disposal of stocks and liquidation of the business- which is at maximum are six Gregorian months.

5-If the Second party does not fulfill its obligations under this agreement, the First party may terminate the contract and receive an amount of……………. as an indemnification which is not subject to the judicial discretion.

Seventh:  Final Provisions:

1- Disputes: Any disputes arising out of this agreement or its appendices in any time shall be amicably resolved. If not, then, it shall be referred to arbitration according to UAE Arbitration Centre of and to UAE laws knowing that the judicial notices and letters rogatory shall be sent to the parties on their addresses mentioned herein.

2- Language of Agreement: This agreement is executed in both Arabic and English languages. In case of any variations in meaning, the Arabic text shall prevail.

Copies of Agreement Executed in duplicate, one original copy per each party, for necessary actions.

Allah is the best of witnesses,

The legal representative of the first party Company    The legal representative of the second party Company

Name: …………………………                                                                    Name: ………………………………

Signature: ………………………                                                                 Signature: ………………………………