The Master Franchise Agreement is a crucial document used when a franchise business wishes to expand its operations through a master franchisee in Malaysia. This agreement type is specifically regulated under the Malaysian Franchise Act 1998 and must be registered with the Franchise Registry. The document outlines the complete framework for the master franchise relationship, including territory rights, development obligations, fee structures, operational standards, and sub-franchising procedures. It is particularly important in the Malaysian market due to local business practices, cultural considerations, and regulatory requirements. The agreement serves as the foundational document for establishing a multi-unit franchise operation, where the master franchisee acts as a mini-franchisor within their designated territory, with rights and obligations to develop the brand through sub-franchisees while maintaining the franchisor's standards and protecting their intellectual property.

1. Parties: Identification of the franchisor and master franchisee, including complete legal names and registered addresses

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

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

4. Grant of Rights: Scope of master franchise rights, territory definition, and sub-franchising authority

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

6. Fees and Payments: Initial fees, ongoing royalties, and payment terms for both master franchise and sub-franchise arrangements

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

8. Obligations of the Master Franchisee: Operational requirements, development schedule, and sub-franchisee management duties

9. Intellectual Property: Use of trademarks, copyright materials, and protection of proprietary information

10. Training and Support: Initial and ongoing training requirements for master franchisee and sub-franchisees

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

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

13. Reports and Records: Financial reporting, audit rights, and record-keeping requirements

14. Sub-Franchising Procedures: Process for selecting and appointing sub-franchisees

15. Transfer and Assignment: Conditions for transfer of rights and change of ownership

16. Termination: Grounds for termination and termination procedures

17. Post-Termination Obligations: Obligations and restrictions after agreement ends

18. Confidentiality: Protection of confidential information and trade secrets

19. Governing Law and Dispute Resolution: Applicable law and dispute resolution mechanisms

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