Business Contracts and Corporate Structures Explained

Franchise

Franchising is a modern form of contracting where the franchisor or producer places identified products under their brand without requiring capital investment or assuming the risk factors typically associated with the franchisee.

Franchise Business Model

This contract allows a person (the franchisee) to license a method for the manufacture and/or marketing of a product or service from the franchisor.

Duties and Responsibilities

• Franchisor: Provides control, technical assistance, and collects royalties.
• Franchisee: Must respect the territory, product standards, pricing, quality, and pay franchise fees while meeting established technical requirements.

Factoring

Factoring is the provision of a service where a factoring company performs administrative and financial tasks for a customer (the selling firm). This involves short-term billing arising from the sale of goods or the provision of services, which the company sells to the factoring firm.

Shopping Center

Companies that own properties housing shopping centers typically lease their premises to various high-prestige, high-quality businesses.

Financial Leasing

Financial leasing is a lease agreement with an option to buy. This contract is commonly used to purchase expensive machinery and industrial plants, but it is also utilized for vehicles, properties, and furniture.

Types of Contributions in a Society

Contributions can be made in kind or in money. This represents what each partner invests in the society, which may include cash, real property, or patents of invention. Losses and profits are distributed in proportion to the contribution.

Difference Between Society and Partner

A company is formed as a new legal entity that can be sued or held liable, which does not automatically imply that the individual partners will be held liable. Partners are individuals who contribute a portion of their assets toward a common end.

Contributions in Society

What each partner brings to the society is measured by their responsibility, as they may withdraw profits or bear losses based on the specific contribution made.

Liability of Partners

Liability depends on the type of company incorporation and may be supportive or limited. It is considered solidary when the partners are collectively responsible for the total debts incurred by the society.

Organs of the S.A. (Corporation)

The Directory

The directory is an executive body responsible for implementing decisions made by the assembly. It consists of members representing a significant portion of the share capital, led by a chairman chosen by the members themselves.

The Assembly

The assembly is formed by all shareholders entitled to vote. A quorum must be present for the assembly to make a valid decision.