The Franchise Development Agreement is a crucial document used when a franchisor wishes to expand their franchise network through a developer who will establish multiple franchise units within a defined territory. This agreement, governed by Belgian law, must comply with specific pre-contractual information requirements under Book X of the Code of Economic Law, which mandates a 30-day disclosure period before signing. The document outlines development schedules, territorial rights, financial obligations, and operational requirements while serving as a framework for subsequent individual franchise agreements. It's particularly important for businesses planning rapid expansion in Belgium or using Belgium as a base for European operations, as it must align with both Belgian and EU regulations governing franchising, competition, and commercial relationships.
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1. Parties: Identification of the franchisor and developer, including full legal names, registration details, and addresses
2. Background: Context of the agreement, description of the franchise system, and purpose of the development arrangement
3. Definitions: Detailed definitions of key terms used throughout the agreement
4. Grant of Development Rights: Scope of development rights, territory, and exclusivity provisions
5. Development Schedule: Specific timelines and targets for opening franchise units
6. Development Fees: Financial terms including development fees, franchise fees, and payment schedules
7. Obligations of Developer: Developer's duties including site selection, construction, and timeline compliance
8. Obligations of Franchisor: Franchisor's support, training, and assistance obligations
9. Individual Franchise Agreements: Terms governing the execution of individual franchise agreements for each unit
10. Intellectual Property: Protection and usage of trademarks, trade secrets, and other IP during development
11. Confidentiality: Protection of confidential information and trade secrets
12. Term and Renewal: Duration of the agreement and conditions for renewal
13. Termination: Grounds for termination and consequences
14. Post-Termination Obligations: Obligations of parties after agreement ends
15. Governing Law and Jurisdiction: Belgian law application and dispute resolution procedures
1. Performance Guarantees: Required when additional financial security is needed from the developer
2. Master Franchise Provisions: Included when developer has rights to sub-franchise within the territory
3. International Development: Used when development rights extend to multiple countries
4. Currency and Cross-Border Payments: Required for international development agreements
5. Co-Development Rights: Used when multiple developers operate in the same or adjacent territories
6. Alternative Dispute Resolution: Optional mediation or arbitration procedures
7. Force Majeure: Specific provisions for unforeseen circumstances affecting development
8. Right of First Refusal: Developer's rights to additional territories or opportunities
1. Development Territory: Detailed description and/or maps of the development territory
2. Development Schedule and Targets: Detailed timeline for unit openings and development milestones
3. Fee Schedule: Comprehensive breakdown of all fees and payment terms
4. Form of Individual Franchise Agreement: Template agreement for individual franchise units
5. Brand Standards: Specifications for unit design, construction, and operation
6. Training Requirements: Detailed training programs and requirements for each unit
7. Pre-contractual Information Document: Required under Belgian law, containing mandatory disclosures
8. Technical Specifications: Construction and equipment requirements for franchise units
9. Approved Suppliers: List of approved suppliers and products
10. Financial Requirements: Detailed financial criteria for each unit and the developer
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