Franchise Development Agreement Template for Philippines

The Franchise Development Agreement is a crucial document used when a franchisor wishes to expand their franchise system through a developer who will establish multiple franchise units within a defined territory in the Philippines. This agreement is particularly important in the Philippine market, where franchising is a popular business expansion model subject to specific regulatory requirements. The document encompasses all essential elements required by Philippine law, including development obligations, territorial rights, intellectual property protection, and compliance with local franchise regulations. It is more comprehensive than a standard franchise agreement as it covers the development of multiple units and typically includes more sophisticated provisions regarding development schedules, territory protection, and financial requirements. The agreement must comply with Philippine franchise laws, particularly DTI Department Administrative Order No. 19-12, and includes mandatory disclosures and provisions protecting both parties' interests in a long-term development relationship.

1. Parties: Identification of the Franchisor and the Development Rights Holder/Developer, including complete legal names and addresses

2. Background: Context of the agreement, description of the franchise system, and purpose of the development arrangement

3. Definitions: Detailed definitions of terms used throughout the agreement, including specific Philippine legal and regulatory terms

4. Grant of Development Rights: Specific rights granted to develop the franchise within defined territories and timeframes

5. Development Schedule and Obligations: Minimum development obligations, timeline for opening units, and development milestones

6. Territory: Precise definition of the geographic area where development rights are granted

7. Fees and Payments: Development fees, franchise fees, royalties, and other financial obligations

8. Developer's Obligations: Specific duties, responsibilities, and performance standards for the developer

9. Franchisor's Obligations: Support, training, and assistance to be provided by the franchisor

10. Intellectual Property: Protection and usage of trademarks, trade secrets, and other IP in compliance with Philippine IP laws

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, procedures, and consequences

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

15. Governing Law and Dispute Resolution: Application of Philippine law and dispute resolution mechanisms

16. General Provisions: Standard legal provisions including notices, amendments, and severability