a short document simply stating that, subject to a suitable site being found, the franchisee will enter into the contract set out in the franchise agreement provided, of course, that the franchisee has read and approved the franchise agreement within a reasonable time.(11) Having accepted this condition the franchisee pays the franchisor a deposit which forms part of the initial fee. The search for a suitable site as well as associated research into planning, permitting, viability of the site, etc. can begin. If no suitable site is found, the deposit is usually returned. However, if the franchisee rejects the site or changes his/her mind about the franchise, the deposit is usually forfeited.(12) The franchise agreement is a far more detailed document and covers the following areas: 1. Nature and name of the activity being franchised 2. Franchise territory 3. Term of the franchise agreement 4. Franchise Fees 5. Obligations of the franchisor and franchisee 6. Selling the business 7. Termination of the agreement...
