Fourth, there will be a monitoring and auditing clause in the contract.
This may bespelled out explicitly, but will usually give the franchisor arbitrary and discretionarypower. Fifth, the contract will have a termination clause. The termination clausewill heavily favour the franchisor who can practically end at will.
The franchisee, onthe other hand, also can terminate, but at unfavourable terms, usually incurring aheavy penalty. Finally, the contract will contain miscellaneous clauses dealing withsale of the franchise, rights of heirs, territorial rest Second, the franchisee agrees to operate the business in the manner stipulatedby the franchisor. This includes hours of operation, pricing scheme, inventory levels,and adherence to the operating manual ñ if one is supplied.
Third, the franchiseeagrees to pay royalties to the franchisor. This is usually in the form of a non-linearoutlay schedule, comprised of a Öxed fee plus a share of the revenues.Fourth, there will be a monitoring and auditing clause in the contract. This