franchise agreement [master]

8/2/2019 Franchise Agreement [Master]

http://slidepdf.com/reader/full/franchise-agreement-master 1/26

DATED 2010

LUX MANAGEMENT AND INVESTMENTS LIMITED (1)

HIGH STARS TRADING JLT (2)

MASTER FRANCHISE AGREEMENT

IN RESPECT OF

“CAFFE CONCERTO”

Morley House, 26 Holborn Viaduct, London EC1A 2AT Telephone: 020 7936 8888 Facsimile: 020

7936 8880

DX 49 London/Chancery Lane www.lawrencestephens.com



Morley House, 26 Holborn Viaduct, London EC1A 2AT Telephone: 020 7936 8888 Facsimile: 020

7936 8880

DX 49 London/Chancery Lane www.lawrencestephens.com



CONTENTS

CLAUSE

1.Definitions...........................................................................................................................................12.Licence................................................................................................................................................3

3.Fees....................................................................................................................................................4

4.Development.......................................................................................................................................5

5.Licensor's obligations..........................................................................................................................6

6.Licensee's obligations..........................................................................................................................7

7.Manual and franchise agreement.........................................................................................................9

8.Confidentiality obligation......................................................................................................................9

9.Accounting records..............................................................................................................................9

10.Insurance...........................................................................................................................................9

11.Licensor's right to communicate with franchisees.............................................................................10

12.Trade Marks....................................................................................................................................10

13.Termination.....................................................................................................................................11

14.Consequences of termination..........................................................................................................12

15.Indemnity.........................................................................................................................................13

16.No warranties without authority........................................................................................................13

17.Reservation of rights........................................................................................................................13

18.Third party rights..............................................................................................................................13

19.No partnership or agency.................................................................................................................13

20.Force majeure.................................................................................................................................13

21.Set-off..............................................................................................................................................14

22.Default interest................................................................................................................................14

23.Severance.......................................................................................................................................15

24.Variation..........................................................................................................................................15

25.Waiver.............................................................................................................................................15

26.Expert..............................................................................................................................................15

27.Counterparts....................................................................................................................................16

28.Notices............................................................................................................................................16

29.Entire agreement.............................................................................................................................17

30.Governing law and jurisdiction.........................................................................................................18

Schedule 1...........................................................................................................................................19

The Territories .....................................................................................................................................19

United Arab Emirates...........................................................................................................................19

Saudi Arabia ........................................................................................................................................19

Qatar....................................................................................................................................................19

Kuwait..................................................................................................................................................19

Bahrain.................................................................................................................................................19

Oman...................................................................................................................................................19

Yemen..................................................................................................................................................19

Iraq.......................................................................................................................................................19

Syria.....................................................................................................................................................19

Lebanon ..............................................................................................................................................19



Jordon..................................................................................................................................................19

Algeria..................................................................................................................................................19

Morocco...............................................................................................................................................19

Tunisia..................................................................................................................................................19

Egypt ...................................................................................................................................................19

Libya....................................................................................................................................................19

Schedule 2...........................................................................................................................................20

The Trade Marks .................................................................................................................................20

[FURTHER DETAILS TO FOLLOW].....................................................................................................20

Schedule 3...........................................................................................................................................21

Specimen Franchise Agreement ..........................................................................................................21



THIS AGREEMENT is made the day of 2010

PARTIES:

LUX MANAGEMENT AND INVESTMENTS LIMITED, incorporated and registered in

England and Wales with Company No. 04175641 whose registered office address is at 152Brompton Road, Knightsbridge, London SW3 1XH (Licensor ); and

HIGH STARS TRADING JLT, incorporated and registered in [ ] with Company No. [ ]

whose registered office address is at [REGISTERED OFFICE ADDRESS] (Licensee).

BACKGROUND

(A) The Licensor has been granted the right from the Owner to carry on the Business and to

licence others to carry on the Business under the Trade Name throughout the World.

(B) The Licensor has been granted the right to use information on the management and

operation of the Business and the System.

(C) The Owner is the owner of all rights to the Trade Marks, the Trade Name and the System

and has registered and applied to register the Trade Marks.

(D) The Licensee wishes to acquire from the Licensor the right and franchise to operate the

System and the Business within the Territories and to license others to operate the System

and carry on the Business in any individual countries within the Territories in accordance

with the terms and conditions set out in this Agreement.

AGREED TERMS

1. DEFINITIONS

1.1 The definitions and rules of interpretation in this clause apply in this Agreement.

Business: the business of a retail restaurant, café and patisserie operating under theTrade Name.

Commencement Date: [DATE].

Currency: GBP (Pounds Sterling).

Expert: a person appointed in accordance with clause 26.

Franchise: an Outlet operated by a Franchisee or the Licensee or a subsidiary of theLicensee.

Franchise Agreement: the agreement in the form set out in Schedule 3 to this Agreement or such other agreement as the Licensor may from time to time authorisefor use by the Licensee within the Territories.

Franchisee: any person including the Licensee or a subsidiary of the Licenseegranted a Franchise by the Licensee in accordance with the terms of this Agreement.

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Gross Quarterly Receipts: the amounts received by the Licensee from Franchiseesin respect of the payment of the Management Fee as those terms are defined in this Agreement or the Franchise Agreement.

Initial Fee: £125,000 payable in accordance with clause 3.1.

Management Fee: 4% of the Gross Quarterly Receipts.

Manual: the Licensor's operating manual setting out the way in which the Licenseeand the Franchisees shall operate the Business as amended by the Licensor in itsabsolute discretion from time to time.

Outlet: a site from which a Franchise is operated.

Owner: FLOWMADE ENTERPRISES LIMITED, a company incorporated andregistered in England with Company No. 03137990.

Payment Date: the [NUMBER] day of each Quarter.

Products: the products described in the Manual.

Quarter: means a consecutive period of 3 calendar months from theCommencement Date.

Rights: the rights granted to the Licensee in clauses 2.1 and 2.2.

Services: the services described in the Manual.

Stationery: all letterheads, invoices, order forms and other documents referred to inthe Manual to be used in connection with the Business.

System: the conducting, marketing and promoting of the Business in the Territories.

Targets: the minimum performance criteria set out in clause 4.

Territories: the territories described in Schedule 1.

Trade Marks: the trade marks listed in Schedule 2 and any other trade marksregistered by the Owner or the Licensor in relation to the Business from time to timeduring the Term.

Trade Name: the name “CAFFÉ CONCERTO” under which the Business is carriedon.

VAT: value added tax chargeable under the Value Added Tax Act 1994 and anysimilar replacement or additional tax.

1.2 References to any clause or Schedule shall be to the particular clause or Schedulecontained in this Agreement.

1.3 Clause, schedule and paragraph headings shall not affect the interpretation of this Agreement.

1.4 A person includes a natural person, corporate or unincorporated body (whether or not having separate legal personality).

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1.5 The Schedules form part of this Agreement and shall have effect as if set out in full inthe body of this Agreement. Any reference to this Agreement includes the Schedules.

1.6 A reference to a company shall include any company, corporation or other bodycorporate, wherever and however incorporated or established.

1.7 Words in the singular shall include the plural and vice versa.

1.8 A reference to one gender shall include a reference to the other genders.

1.9 A reference to any party shall include that party's personal representatives,successors or permitted assigns.

1.10 A reference to a statute or statutory provision is a reference to it as [amended,extended or re-enacted from time to time.

1.11 A reference to writing or written includes faxes but not e-mail.

1.12 References to a document in agreed form are to that document in the form agreedby the parties and initialled by or on behalf of them for identification.

1.13 A reference to "this Agreement" or to any other agreement or a document referred toin this Agreement is a reference to this Agreement or such other document or agreement as varied or novated (in each case, other than in breach of the provisionsof this Agreement) from time to time.

1.14 References to clauses and Schedules are to the clauses and Schedules of this Agreement; references to paragraphs are to paragraphs of the relevant Schedule.

1.15 Any phrase introduced by the terms including, include, in particular or any similar expression shall be construed as illustrative and shall not limit the sense of the wordspreceding those terms.

2. LICENCE

2.1 The Licensor grants to the Licensee the exclusive right to operate the Business andto license Franchisees to operate the Business in the Territories.

2.2 The Licensor also grants the Licensee the right to use and license the use of:

(a) the Trade Name;

(b) the System;

(c) the Manual; and

(d) the Stationery and all the copyright material,

in the Territories.

2.3 The Licensee shall not license the use of the Rights outside the Territories.

2.4 The Licensee shall only operate a Franchise through a subsidiary company that hasentered into a Franchise Agreement in respect of each Outlet.

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2.5 The Term of this Agreement shall commence on the Commencement Date and shallbe for a fixed period of [10] years continuing after that period until terminated by sixmonths’ notice given by either party (subject to the provisions of clause 13).

3. FEES

3.1 Initial Fee

(a) The Licensee shall on the date of this Agreement pay to the Licensor in theCurrency the Initial Fee.

(b) The payment of the Initial Fee shall represent payment for the Rightsgranted under clause 2 in respect of the individual or groups of countriescontained in the Territories and comprise the following:

(i) in respect of United Arab Emirates (excluding Saudi Arabia):£25,000 GBP;

(ii) in respect of Saudi Arabia: £25,000 GBP;

(iii) in respect of Qatar, Kuwait, Bahrain, Oman, Yemen and Iraq:£25,000 GBP;

(iv) in respect of Syria, Lebanon and Jordon: £25,000 GBP;

(v) in respect of Algeria, Morocco, Tunisia, Egypt and Libya:£25,000 GBP;

(c) Unless the Licensor otherwise notifies the Licensee in writing, the Licenseeshall make all payments electronically to the following bank account:

Bank:

Address:

Account Name:

Sort Code:

Account No:

IBAN No:

(d) The Initial Fee due under this Agreement is exclusive of VAT which shall,where applicable, be paid by the Licensee at the prevailing rate on the duedate for payment.

3.2 Management Fee

(a) The Licensee shall pay the Management Fee Quarterly in arrears with effectfrom the Commencement Date. The Management Fee shall be paid on thePayment Date in the Currency without set off or deduction but together withany VAT.

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(b) The Management Fee shall be paid in accordance with the manner set outin clause 3.2c.

(c) The Gross Quarterly Receipts shall be determined as follows:-

(i) within [ ] days of the end of each Quarter, the Licensee shallprepare and deliver to the Licensor a statement of the Gross QuarterlyReceipts for the preceding qualifying customers;

(ii) within [ ] days after the Licensee has delivered the statementGross Quarterly Receipts, the Licensor shall either confirm in writingthat it agrees such statement or gives notice that it does not;

(iii) if the Licensor does not agree such statement, the parties shallendeavour to resolve all matters in dispute as soon as practicable. If they fail to do so within [14] days of the notice, either party may refer the dispute for resolution to an Expert;

(iv) any payment or additional payment or refund to be made as a result of any decision of the Expert shall be made within 14 days of receipt bythe parties of the decision of the Expert.

3.3 The Licensee shall convert the payment referred to in clause 3.2 into the Currency atthe rate of exchange applicable five working days prior to the payment.

4. DEVELOPMENT

4.1 The Licensee shall use its best endeavours to exploit fully the market for the Systemin each of the individual countries in the Territories.

4.2 The Licensee shall be required to have the following numbers of Franchises by theanniversary set out below:

Anniversary Date Number of Franchises

31 December 2013 10

4.3 If the Licensee fails to reach the Target by [31 December 2013], then the provisionsof this Agreement shall terminate on written notice by the Licensor to the Licensee

and all rights granted to the Licensee under this Agreement shall be cancelled andthe Licensee shall have no further right to enter into Franchise Agreements pursuantto this Agreement.

4.4 Notwithstanding the provisions of clause 4.2, if for whatever reason the Licensee hasnot granted a Franchise in any individual country included in the Territories by [ ],then the Licensor shall have the right to remove that particular country from the list of Territories covered by this Agreement and all rights granted to the Licensee under this Agreement in respect of that individual country shall be cancelled and theLicensee shall have no further right to enter into Franchise Agreements in thatindividual country pursuant to this Agreement.

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5. LICENSOR'S OBLIGATIONS

5.1 The Licensor shall immediately following the Commencement Date:

(a) provide to the Licensee such assistance as the Licensor shall reasonablyconsider to be necessary for the purposes of:

(i) setting up the System;

(ii) development of the System;

(iii) quality control procedures;

(iv) recruitment; and

(v) marketing,

such assistance to consist of not less than [NUMBER] man days attendanceby [PERSON] or by another executive of similar status at [ ]and in cases of emergency to provide such assistance as the Licensor shallreasonably consider to be necessary within the Territories at the Licensee'sexpense;

(b) [second [NAME OF EMPLOYEE] to the Licensee for a period of [NUMBER]months;]

(c) [in every period of twelve months attend the Outlets on at least [NUMBER]occasions for periods of not less than [NUMBER] days in order to monitor the progress of the Business;]

(d) provide [NUMBER] weeks training on the System for [NUMBER] of theLicensee's personnel;

(e) provide at the Licensor's premises at [ADDRESS] training to not more than[NUMBER] employees of the Licensee on how to train Franchisees;

(f) deliver on loan such training material and deliver subject to thereimbursement of the Licensor's costs therefor such other material as theLicensor shall reasonably consider the Licensee shall require for the first 12months period following the Commencement Date and ensure that suchmaterial shall constantly be updated and replenished;

(g) provide advice on finding and acquiring premises for the Outlet, including

giving site selection criteria;

(h) provide advice on alterations to and fixtures and fittings in the Outlet,

including providing plans and specifications for internal layout;

(i) provide general advice on how to set up the Franchisee's Business;

(j) provide the Licensee with such know-how, advice and guidance relating to

the Business as it thinks fit;

(k) update the Manual and System from time to time and inform the Licensee in

writing of all such updates;

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(l) assist the Licensee in procuring such goods and services as are necessary

for the purposes of the Business;

(m) provide the Services and items referred to in clause 5.1 free of charge

unless otherwise specified but the Licensee shall be responsible for the

costs and expenses of its employees.5.2 Immediately after execution of this Agreement provide the Licensee with a copy of

the Manual.

6. LICENSEE'S OBLIGATIONS

6.1 Commencement. The Licensee shall immediately following the CommencementDate review the Manual and the Franchise Agreement and suggest any modificationsor amendments to either which may be required within any of the Territories.

6.2 General. The Licensee shall either itself or procure that the Franchisees:

(a) operate the System strictly in accordance with the provisions of the Manual;

(b) use its best endeavours to expand the Business and reach the Target;

(c) seek out and accept only the highest quality of Franchisees;

(d) maintain high standards in relation to all obligations under Franchise Agreements;

(e) not do anything which is detrimental to the Business;

(f) provide timely and efficient assistance and guidance to Franchisees;

(g) comply with obligations set out in the Manual; and

(h) comply with instructions from the Licensor which do not conflict with this Agreement.

(i) obtain, maintain and comply with all necessary licences and consents andcomply with all relevant legislation in each of the Territories in relation to theBusiness;

(j) use its best endeavours to protect and promote the goodwill in the Business;

(k) only use Stationery and Products which are supplied by a supplier that hasbeen approved in writing by the Licensor;

(l) procure that Franchisees comply with ordering, invoicing and accountingprocedures as required by the Licensor or as set out in the Manual;

(m) procure that the Franchisees maintain sufficient stocks to meet all demandfrom customers of the Business;

(n) procure that the Franchisees pay all third party suppliers promptly inaccordance with the terms of supply agreed with them and not enter into anyarrangement or agreement to factor, charge or otherwise deal with the debts

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of the Franchisee’s Business without the prior written consent of theLicensor;

(o) other than as permitted by the this Agreement, not licence any other personto operate the Business under the Trade Name;

(p) without delay, inform the Licensor of any improvement or modification to theBusiness or System or business opportunity which comes to its attention;

(q) promptly give the Licensor any information that the Licensee may obtain inrelation to potential franchise opportunities sales outside the Territories or any matter that could affect sales favourably or unfavourably inside or outside the Territories;

(r) supply the Licensor with such information relating to the Franchisee'sBusiness in such form and at such times as the Licensor may from time totime reasonably require;

(s) procure that the Franchisees introduce any improvements or modificationsinto the Business when requested by the Licensor;

(t) at the request of the Licensor, provide potential franchisees with informationas reasonably requested;

(u) attach any notices that the Licensor requires to stationery, products andpackaging;

(v) procure that the Franchisees use only signs and packaging in connectionwith the Business as have been approved by the Licensor; and

(w) procure that the Franchisees give such notices in such places as required bylaw and as the Licensor may require to the effect that the Franchisee isoperating the Business under licence from the Licensee.

6.3 Staff. The Licensee shall ensure that all persons required to enable the Licensee tooperate the Business in accordance with this Agreement are employed by theLicensee.

6.4 Trade Marks. The Licensee shall immediately on receiving a request from theLicensor execute any trade mark licence reasonably required by the Licensor and doall such other things and execute such further documents as the Licensor may

reasonably require in relation to the Trade Marks, the Trade Name and any other trade marks or trade names used in the Business.

6.5 Franchisees. The Licensee shall:

(a) only appoint Franchisees who have been previously approved in writing bythe Licensor;

(b) strictly enforce the terms of the Franchise Agreement and the Manual; and

(c) not permit Franchisees to commence business until they have completedtheir training as set out in the Franchise Agreement.

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7. MANUAL AND FRANCHISE AGREEMENT

7.1 The Licensee shall not make any material amendments or deletions to the Manual or the Franchise Agreement without the prior written consent of the Licensor and shallimmediately submit to the Licensor the latest version of the Manual and theFranchise Agreement.

7.2 The Licensee shall adopt all amendments or deletions to the Manual or the Franchise Agreement immediately on receiving notification of them from the Licensor.

8. CONFIDENTIALITY OBLIGATION

The Licensee acknowledges that the Manual and all other information issuing fromthe Licensor and relating to the System is confidential and the Licensee shall not andshall procure that no other person shall at any time without the prior written consentof the Licensor (whether before or after termination of this Agreement) divulge or usewhether directly or indirectly for its own benefit or that of any other person, firm or company any such information unless such information has entered the publicdomain otherwise than by reason of a breach of this Agreement.

9. ACCOUNTING RECORDS

The Licensee shall:

(a) maintain records of all sales and Gross Quarterly Receipts and submit to theLicensor a statement of them on the [NUMBER] day of each Quarter. Suchrecords and statement shall be in the form approved by the Licensor;

(b) keep and maintain complete and accurate accounts and records relating to

the Business in a form approved by the Licensor. All such records shall befull, accurate, up to date and sufficient to ascertain the amount of theManagement Fee due;

(c) deliver to the Licensor a copy of the audited accounts of the Licensee, asfiled in each year, within one month of such filing and, in any event, withinsix months of the relevant accounting year end;

(d) retain its accounting and financial records for at least six years after the endof any accounting year to which those records relate;

(e) allow representatives of the Licensor to investigate the Licensee's records in

relation to the Business and take copies of the Licensee's accounts andrecords on reasonable notice, during usual business hours during the Termand for a period of six years after the termination of this Agreement; and

(f) supply to the Licensor copies of all financial and fiscal information which theLicensor may reasonably request.

10. INSURANCE

10.1 The Licensee shall procure that each Franchisee shall take out and maintain an all-risk insurance policy with a reputable insurance company (or companies) with suchamount of cover as the Licensor may, in its absolute discretion, specify in the

Manual. Such policy (or policies) shall include:

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(a) liability for employees and third parties;

(b) public liability;

(c) liability for damage to property;

(d) loss of profits and interruption of the Business; and

(e) any other cover which the Licensor may, in its absolute discretion, specify.

10.2 The Licensee shall provide the Licensor with copies of all such policies and renewals.

10.3 The Licensee shall procure that the Franchisee shall promptly pay all premiums for such policies and immediately provide the Licensor with evidence of payment of premiums.

11. LICENSOR'S RIGHT TO COMMUNICATE WITH FRANCHISEES

In order to protect the reputation of the Business the Licensor reserves the right tocommunicate with any of the Franchisees at any time during the Term of this Agreement.

12. TRADE MARKS

12.1 The Licensor warrants that it is not aware of any reason why it might not be entitledto license the Trade Marks and why the use of the Trade Marks by the Licensee inaccordance with the terms of this Agreement would constitute an infringement of anythird party's intellectual property.

12.2 The Licensee acknowledges that:

(a) it does not have any right, title or interest in the Trade Marks or any updatesor improvements to it, save as specifically set out in this Agreement and theManual; and

(b) any goodwill (and any other rights) in the Trade Marks which result from theuse by the Licensee of the Trade Marks shall vest in the Licensor.

12.3 If the Licensee learns of any threatened or actual infringement of the Trade Marks, or of any circumstance which suggests that the use of the Trade Marks may infringe theintellectual property of a third party, it shall immediately inform the Licensor, giving allsuch details as the Licensor requests.

12.4 The Licensor shall have conduct of any proceedings relating to the Trade Marks andmay take whatever action it, in its sole discretion, decides in respect of anyinfringement or alleged infringement of it, or arising from its use. Any rights that theLicensee has under section 30 of the Trade Marks Act 1994 are excluded. TheLicensee shall co-operate with the Licensor in taking such action and the Licensor shall meet any reasonable expenses of the Licensee in doing so.

12.5 The Licensee shall:

(a) not apply for registration of any of the Trade Marks (or any intellectual

property that is confusingly similar to the Trade Marks) in its own name, inany part of the world;

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(b) comply with the Manual and all requests by the Licensor as to the use of theTrade Marks and the ™, © and ® symbols in relation to the Trade Marks;

(c) give assistance to enable the Licensor to register its Trade Marks;

(d) not license (or purport to license) any other person to use any of the TradeMarks;

(e) not use the Trade Marks other than as specifically permitted by this Agreement and the Manual;

(f) not use any intellectual property that is confusingly similar to the TradeMarks;

(g) not do anything that may adversely affect the Trade Marks or the Licensor'sright or title to it; and

(h) immediately stop using any advertising or promotional material or packagingon receipt of a request by the Licensor to do so.

12.6 The Licensee acknowledges and agrees that all intellectual property in the Manual isand shall remain the exclusive property of the Licensor. The Licensee shall hold theManual in safe custody at its own risk and maintained and kept in good condition bythe Licensee until returned to the Licensor.

13. TERMINATION

The Licensor may terminate this Agreement immediately by giving notice in writing tothe Licensee in any of the following events if:

(a) the Licensee fails to reach the Target.

(b) the Licensee fails to pay any amount due under this Agreement on the duedate for payment and remains in default not less than seven days after beingnotified in writing to make such payment; or

(c) the Licensee commits a material breach of any term of this Agreement and(if such breach is remediable) fails to remedy that breach within a period of [14] days after being notified in writing to do so; or

(d) the Licensee repeatedly breaches any of the terms of this Agreement in

such a manner as to reasonably justify the opinion that its conduct isinconsistent with having the intention or ability to give effect to the terms of this Agreement; or

(e) the Licensee gives to the Licensor any false or misleading information, or makes any misrepresentation in connection with obtaining this Agreement or during the Term; or

(f) the Licensee, in the reasonable opinion of the Licensor, does, or permits tobe done, any act which might jeopardise or invalidate the registration of theTrade Marks or does any act which might assist, or give rise to, anapplication to remove the Trade Marks; or

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(g) the Licensee fails to obtain any written approval or consent of the Licensor as expressly required by this Agreement; or

(h) an order is made, a resolution is passed, or a notice is issued convening ameeting for the purpose of passing a resolution, or any analogousproceedings are taken, for the winding-up, administration or dissolution of the Licensee; or

(i) any liquidator, trustee in bankruptcy, receiver, administrative receiver,administrator or similar officer is appointed over, or in respect of, theLicensee or any part of its business or assets; or

(j) any event occurs, or proceeding is taken, with respect to the other party inany jurisdiction to which it is subject that has an effect equivalent or similar to any of the events mentioned in clauses 13h to 13j (inclusive).

14. CONSEQUENCES OF TERMINATION

14.1 Any termination or expiry of this Agreement shall not affect any rights or liabilities thathave accrued prior to such termination.

14.2 On termination or expiry of this Agreement for any reason, the Licensee shall:

(a) immediately pay the Licensor the full amount of all sums due from theLicensee to the Licensor;

(b) cease to operate the Business and System and to trade under any of theTrade Marks, and not do anything that may indicate any relationshipbetween them and the Licensor;

(c) immediately stop using the Trade Marks and take all steps as the Licensor may reasonably require to remove the name of the Licensee from allapplicable trade marks registries in any jurisdictions;

(d) pass all enquiries, and full details of potential customers, to the Licensor;

(e) return all copies of the Manual, Stationery, and other Products or materialsbearing the Trade Marks;

(f) assign to the Licensor all domain name registrations and rights in web sitecontent owned or used by the Licensee in the Business.

14.3 If this Agreement is terminated by the Licensor the Licensor shall provide writtennotice to each Franchisee of its intention to assume responsibility for all Franchise Agreements and that this Agreement has been terminated.

14.4 The Licensee shall not be entitled to receive any payment payable under theFranchise Agreements and shall immediately forward all such payments to theLicensor if (notwithstanding the provisions of this clause 14.4) the Licensee receivesany such payment.

14.5 It is the intention of the parties that the Licensor shall receive all the benefits and beresponsible for all the obligations under the Franchise Agreements that may exist at

the time this Agreement is terminated and the Licensee shall do such things, execute

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(e) voluntary or mandatory compliance with any law (including a failure to grantany licence or consent needed or any change in the law or interpretation of the law);

(f) fire, explosion or accidental damage;

(g) loss at sea;

(h) extreme adverse weather conditions;

(i) collapse of building structures, failure of plant machinery, machinery,computers or vehicles;

(j) any labour dispute, including (but not limited to) strikes, industrial action or lockouts;

(k) non-performance by suppliers or subcontractors; and

and the corresponding obligations of the other party will be suspended to the sameextent.

20.2 Any party that is subject to a Force Majeure Event shall not be in breach of this Agreement, provided that:

(a) it promptly notifies the other parties in writing of the nature and extent of theForce Majeure Event causing its failure or delay in performance;

(b) it could not have avoided the effect of the Force Majeure Event by takingprecautions which, having regard to all the matters known to it before theForce Majeure Event, it ought reasonably to have taken, but did not; and

(c) it has used all reasonable endeavours to mitigate the effect of the ForceMajeure Event to carry out its obligations under this Agreement in any waythat is reasonably practicable and to resume the performance of itsobligations as soon as reasonably possible.

20.3 If the Force Majeure Event prevails for a continuous period of more than six months,may terminate this Agreement by giving 14 days' written notice to the other party. Onthe expiry of this notice period, this Agreement will terminate and the provisions of clause 14 shall apply. Such termination shall be without prejudice to the rights of theparties in respect of any breach of this Agreement occurring prior to such termination.

21. SET-OFF

All amounts due under this Agreement from the Licensee to the Licensor shall bepaid in full without any deduction or withholding other than as required by law. TheLicensee shall not be entitled to assert any credit, set-off or counterclaim against theLicensor in order to justify withholding payment of any such amount in whole or inpart.

22. DEFAULT INTEREST

If the Licensee fails to pay any amount payable by it under this Agreement, the

Licensor may charge the Licensee interest on the overdue amount. The Licenseeshall pay the interest immediately on demand, from the due date up to the date of

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actual payment, after as well as before judgment, at the rate of 4% per annum abovethe base rate for the time being of [ ]. Such interest shall accrue on adaily basis and be compounded quarterly.

23. SEVERANCE

23.1 If any court or competent authority finds that any provision of this Agreement (or partof any provision) is invalid, unenforceable or illegal, that provision or part-provisionshall, to the extent required, be deemed to be deleted, and the validity andenforceability of the other provisions of this Agreement shall not be affected.

23.2 If any invalid, unenforceable or illegal provision would be valid, enforceable and legalif some part of it were deleted, the provision shall apply with the minimummodification necessary to make it legal, valid and enforceable and, to the greatestextent possible, to give effect to the commercial intention of the parties.

24. VARIATION

No variation of this Agreement or of any document referred to in it shall be effectiveunless it is in writing and signed by the parties (or their authorised representatives).

25. WAIVER

No failure or delay by a party to exercise any right or remedy provided under this Agreement or by law shall constitute a waiver of that (or any other) right or remedy,nor shall it preclude or restrict the further exercise of that or any other right of remedy. No single or partial exercise of such right or remedy shall preclude or restrictthe further exercise of that (or any other) right or remedy.

26. EXPERT

26.1 The parties shall agree on the appointment of an independent Expert.

26.2 If the parties are unable to agree on an Expert within seven days of either partyserving details of a suggested expert on the other, either party shall then be entitledto request the President for the time being of the Institute of Chartered Accountantsin England and Wales to appoint a chartered accountant of as Expert.

26.3 The Expert is required to prepare a written decision and give notice (including acopy) of the decision to the parties within a maximum of three months of the matter being referred to the Expert.

26.4 If the Expert dies, becomes unwilling or incapable of acting, or does not deliver thedecision within the time required by this clause, then:

(a) either party may apply to the President for the time being of the Institute of Chartered Accountants in England and Wales to discharge the Expert and toappoint a replacement Expert with the required expertise; and

(b) this clause applies in relation to the new Expert as if he were the first Expertappointed.

26.5 All matters under this clause must be conducted, and the Expert's decision shall be

written, in the English language.

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26.6 The parties are entitled to make written submissions to the Expert and will provide (or procure that others provide) the Expert with such assistance and documents as theExpert reasonably requires for the purpose of reaching a decision.

26.7 To the extent not provided for by this clause, the Expert may, in his reasonablediscretion, determine such other procedures to assist with the conduct of thedetermination as he considers just or appropriate.

26.8 Each party shall, with reasonable promptness, supply each other with all informationand give each other access to all documentation and personnel as the other partyreasonably requires to make a submission under this clause.

26.9 The Expert shall act as an expert and not as an arbitrator. The Expert shall determinethe matter referred to him which may include any issue involving the interpretation of any provision of this Agreement, his jurisdiction to determine the matters and issuesreferred to him or his terms of reference. The Expert's written decision on the mattersreferred to him shall be final and binding in the absence of manifest error or fraud.

26.10 Each party shall bear its own costs in relation to the reference to the Expert. TheExpert's fees and any costs properly incurred by him in arriving at his determination(including any fees and costs of any advisers appointed by the Expert) shall be borneby the parties in such other proportions as the Expert shall direct.

27. COUNTERPARTS

This Agreement may be executed in any number of counterparts, each of which,when executed and delivered, shall constitute an original of this Agreement, but allthe counterparts shall together constitute the same agreement.

28. NOTICES

28.1 A notice or other communication given to a party under or in connection with this Agreement:

(a) shall be in writing;

(b) shall be signed by or on behalf of the party giving it;

(c) shall be sent to the party for the attention of the person at the address,specified in this clause (or to such other person or to such other address, asthat party may notify to the others, in accordance with the provisions of this

clause); and

(d) may be:

(i) delivered personally; or

(ii) sent by commercial courier; or

(iii) sent by pre-paid first class post or recorded delivery; or

(iv) sent by fax.

28.2 The addresses for delivery of a notice or other communication are as follows:

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(a) Licensor :

(i) address: [ADDRESS]

(ii) for the attention of: [CONTACT]

(iii) fax number: [FAX NUMBER]

(b) Licensee :

(i) address: [ADDRESS]

(ii) for the attention of: [CONTACT]

(iii) fax number: [FAX NUMBER]

28.3 If a notice or other communication has been properly sent or delivered in accordancewith this clause, it shall be deemed to have been received as follows:

(a) if delivered personally, at the time of delivery; or

(b) if sent by commercial courier, at the time of signature of the courier'sdelivery receipt; or

(c) if sent by pre-paid first class post or recorded delivery, [9.00 am] on the [fifth]Business Day after posting; or

(d) if sent by fax, at the time of transmission.

28.4 For the purposes of this clause, if deemed receipt is not within business hours

(meaning 9.00 am to 5.30 pm Monday to Friday on a day that is not a public holidayin the place of receipt), the notice or other communication is deemed to have beenreceived when business next starts in the place of receipt.

28.5 To prove delivery, it is sufficient to prove that:

(a) if sent by pre-paid first class post, the envelope containing the notice or other communication was properly addressed and posted; or

(b) if sent by fax, the notice or other communication was transmitted by fax tothe fax number of the party.

28.6 The provisions of this clause shall not apply to the service of any proceedings or other documents in any legal action.

28.7 A notice or other communication required to be given under, or in connection with,this Agreement shall not be validly given if sent by e-mail.

29. ENTIRE AGREEMENT

This Agreement constitutes the entire agreement between the parties andsupersedes all prior agreements in connection with its subject matter. No director,employee or agent of the Licensor is authorised to make any representation or warranty not contained in this Agreement and the Licensee acknowledges that hehas not relied on any such oral or written representations.

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30. GOVERNING LAW AND JURISDICTION

30.1 This Agreement and any dispute or claim arising out of or in connection with it or itssubject matter or formation (including non-contractual disputes or claims) shall begoverned by and construed in accordance with the law of England and Wales. Theparties irrevocably agree that the courts of England and Wales shall have exclusive jurisdiction to settle any dispute or claim that arises out of or in connection with this Agreement or its subject matter or formation (including non-contractual disputes or claims).

30.2 The Licensee shall conduct its business in a lawful manner and shall faithfully complywith all applicable laws or regulations for the conduct of its business.

This Agreement has been entered into on the date stated at the beginning of it.

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SCHEDULE 1

THE TERRITORIES

• United Arab Emirates

• Saudi Arabia

• Qatar

• Kuwait

• Bahrain

• Oman

• Yemen

• Iraq

• Syria

• Lebanon

• Jordon

• Algeria

• Morocco

• Tunisia

• Egypt

• Libya

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SCHEDULE 2

THE TRADE MARKS

Trade Marks ApplicationNo.

Registration No. Country Class

Caffe Concerto and

Conductor Logo

128497 UAE 42

Caffe Concerto and

Conductor Logo

57518 Qatar 42

Caffe Concerto and

Conductor Logo

134049 Lebanon 42

[FURTHER DETAILS TO FOLLOW]

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SCHEDULE 3

SPECIMEN FRANCHISE AGREEMENT

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Signed by [NAME OF DIRECTOR]

for and on behalf of LUXMANAGEMENT ANDINVESTMENTS LIMITED

.......................................

Director

Signed by [NAME OF DIRECTOR]

for and on behalf of HIGH STARSTRADING JLT

.......................................

Director

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franchise agreement [master]

Documents