Franchise Brokers Clause Samples
The 'Franchise Brokers' clause defines the role and involvement of third-party intermediaries who assist in connecting franchisors with potential franchisees. Typically, this clause outlines whether brokers are authorized to represent either party, the terms under which they may operate, and any fees or commissions that may be due as a result of their services. For example, it may specify that the franchisor is responsible for paying broker commissions or require disclosure of broker involvement to all parties. The core function of this clause is to clarify the rights, responsibilities, and compensation of franchise brokers, thereby preventing disputes and ensuring transparency in the franchise sales process.
Franchise Brokers. Any material written Contracts in effect and used by the Company to engage or hire any Franchise brokers (“Franchise Broker”) to provide material services, assistance or support to any Franchisee, or to identify, offer or sell Franchises to potential franchisees, have been made available to Parent. Since January 1, 2014, no Franchise Broker has provided information to prospective franchisees of a Franchise that materially differs from the information contained in the applicable FDD then in effect.
Franchise Brokers a. All agreements with Franchise Brokers are in writing and are identified on the Disclosure Letter.
b. All payments due and payable by the Company to all Franchise Brokers have been paid or are properly accounted for in the Accounts.
c. Except as set forth in the Disclosure Letter, no person other than a Franchise Broker has, or will have, any claim to a commission or other payment from the Company as a result of any action to solicit or engage a Franchisee prior to Closing.