The franchise agreement sets your rights and obligations for years, and lenders read it too. Have a franchise-specialist solicitor review it before you sign.
Key terms to check
- The term and renewal: how long the agreement lasts, whether you can renew, and on what terms. The term should be long enough to recover your investment.
- Your territory: whether it's exclusive, and how it's defined.
- Fees: the initial fee, ongoing fees and any minimum payments. See What ongoing fees will I pay a franchisor?.
- Your obligations: opening hours, suppliers, targets and refurbishment.
- Selling the franchise: the franchisor's approval, any first refusal right and transfer fees. See Can I sell my franchise later?.
- Termination: when either side can end it, and what happens then.
- Restrictions after you leave, such as non-compete clauses. See Are franchise non-compete clauses enforceable?.
- Personal guarantees: whether you guarantee the franchise company's obligations personally.
Why lenders care
- Your loan term usually needs to fit within the agreement's remaining term.
- Termination rights affect how secure the business is.
Get advice
This is general information, not legal advice. Use a solicitor who specialises in franchising.
Last reviewed: 8 October 2026