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Franchise AgreementThis Franchise Agreement (the "Agreement") is made and entered into as of [insert date], by and between:Franchisor:McDonald's USA, LLC, a Delaware limited liability company, with its principal office at 110 N. Carpenter Street, Chicago, Illinois 60607, USA.Franchisee:Cairo Quick Services, LLC, a company organized and existing under the laws of the Arab Republic of Egypt, with its principal office at 12 Nile Plaza, Zamalek, Cairo, Egypt.Statement (Capacity)The Franchisor is a global leader in the quick-service restaurant industry and owns the proprietary McDonald's System. The Franchisee is an independent entity seeking to operate McDonald’s restaurants in Egypt under the Franchisor’s guidance, standards, and operational protocols. Both Parties affirm their capacity to enter into and perform this Agreement.The Franchisor and Franchisee may collectively be referred to as the "Parties" and individually as a "Party."Reason for the ContractThis Agreement is established to formalize the terms under which the Franchisee will operate McDonald’s restaurants in Egypt. The purpose is to expand the McDonald's brand in new territories while ensuring adherence to the Franchisor’s established standards of quality, service, and operational excellence.

PrefaceThis Agreement outlines the terms and conditions under which the Franchisee will operate McDonald's restaurants in Egypt. McDonald's USA, LLC is the Franchisor, and the franchise is granted under the McDonald's System. The McDonald's System includes proprietary operational guidelines, branding, trademarks, and recipes for its restaurants. The Franchisee agrees to uphold the standards established by the Franchisor to ensure consistency and quality across all restaurants. The first restaurants are planned for high-traffic areas, including malls in Cairo and Alexandria.Definitions and Rules for Interpretation of this AgreementFranchisor: McDonald's USA, LLC, the entity granting the franchise rights and overseeing compliance with its system.Franchisee: The business entity that operates McDonald’s restaurants under this Agreement, such as Cairo Quick Services, LLC.Franchise System: The proprietary system owned by McDonald’s, including trademarks, recipes, business methods, training materials, and operational manuals.Gross Sales: Total revenue generated from all operations at the franchise location, excluding taxes, refunds, and discounts.Net Sales: Gross Sales minus returns and allowances, which may include promotional discounts or customer refunds.Licensed Units: Restaurants authorized to operate under the McDonald’s brand.Operating Manuals: Proprietary documents provided by the Franchisor detailing required procedures for running the franchise.Approved Suppliers: Vendors authorized by McDonald’s to provide ingredients, equipment, or other materials for the franchise.Advertising Fund: A collective pool funded by franchisees and managed by McDonald’s for national and global marketing campaigns.Royalty Fee: A recurring payment calculated as a percentage of the Gross Sales, paid by the Franchisee to the Franchisor.Development Plan: A schedule agreed upon by the Franchisee and Franchisor for opening and establishing additional McDonald’s locations.Force Majeure: Unforeseeable events beyond the control of either party, such as natural disasters, war, or governmental actions, which may prevent contract fulfillment.Confidential Information: Proprietary data, including recipes, supplier agreements, operational procedures, and financial terms, protected under the Non-Disclosure Agreement.Training Program: Initial and ongoing courses provided by the Franchisor to ensure the Franchisee and staff meet McDonald’s operational and service standards.

Territory: The geographic area within which the Franchisee has exclusive rights to operate McDonald’s restaurants, as defined in the Agreement.Menu Items: The range of food and beverages approved by McDonald’s, which the Franchisee must offer and prepare according to McDonald's specifications.Point of Sale (POS) System: The electronic system approved by the Franchisor for processing transactions, managing inventory, and reporting sales.Renewal Term: The additional period granted to the Franchisee to operate under the Franchise Agreement after the expiration of the initial term, subject to compliance with all conditions.Quality Standards: The specific criteria set by the Franchisor that all products, services, and operations must meet to maintain the reputation of the McDonald’s brand.Operational Audits: Inspections and evaluations conducted by the Franchisor to ensure compliance with the McDonald's System and maintain quality assurance.Local Marketing Plan: A promotional strategy developed by the Franchisee for its specific territory, subject to the Franchisor’s approval.Supplier Approval Process: The steps required for a supplier to be vetted and authorized by McDonald’s to provide goods or services to the Franchisee.Franchise Development Fee: A fee paid by the Franchisee to secure the rights to develop additional McDonald’s locations within the agreed territory.Complaint Resolution Policy: The protocol established by McDonald’s for addressing and resolving customer complaints received at the franchise location.Termination Notice Period: The time frame required for either party to issue written notice before terminating the Agreement, except in cases of immediate cause.AppointmentThe Franchisor appoints the Franchisee as the exclusive operator of McDonald’s restaurants in Egypt. The Franchisee is granted the right to operate [specific number] of McDonald’s restaurants in locations determined by the Franchisor. Locations must be approved by McDonald’s based on market analysis and franchise development criteria.Terms of Renewal of the AgreementInitial Term: 20 years.Renewal: The franchise may be renewed at the end of the initial term for a further 5-year period, subject to the Franchisee meeting performance criteria, paying all outstanding fees, and complying with McDonald's operational standards. Written notice of intent to renew must be submitted at least 6 months before the expiration of the current term.Termination for Cause: McDonald's may terminate the franchise agreement if the Franchisee fails to meet operational standards or violates the terms of the Agreement.

Establishing and Equipping Licensed UnitsReal Estate: The Franchisee is responsible for securing a suitable location for the McDonald's restaurant, with McDonald's providing guidelines for site selection based on traffic, visibility, and market conditions in Egypt.Construction and Equipment: McDonald’s will provide the Franchisee with detailed specifications for the restaurant layout, interior design, and kitchen equipment. The Franchisee must install McDonald’s approved equipment, including fryers, grills, and refrigeration systems.Permits and Licenses: The Franchisee is responsible for obtaining all necessary building permits, health and safety certifications, and business operating licenses from Egyptian authorities.Operating Licensed Units & Producing Franchising ActivityStaffing: Each restaurant must employ sufficient staff, including managers, cooks, cashiers, and service personnel. All employees must undergo McDonald's training programs.Operational Standards: The Franchisee must ensure compliance with McDonald's strict operational standards, including food preparation, cleanliness, customer service, and health and safety protocols.Food Quality: All food served must meet McDonald's quality standards and must be sourced from McDonald's approved suppliers.Transportation, Receipt, and Responsibility for Food Products & Other ProductsDelivery and Receipt: Food products must be transported using temperature-controlled vehicles to ensure product integrity. The Franchisee must inspect all shipments to confirm that products meet McDonald's standards before accepting delivery.Storage: All products must be stored according to McDonald's specifications, including proper refrigeration for perishable items.Defective ProductsReporting Defects: If any products are found to be defective, the Franchisee must report them to McDonald's within 24 hours. The Franchisor will then either replace the defective products or issue a credit towards future purchases.Record-Keeping: The Franchisee must maintain a log of all defective product reports, which may be subject to audit by McDonald's.

Alternative ProductsApproval for Substitutions: If a product is unavailable, the Franchisee may substitute it with an equivalent product, but only with prior approval from McDonald’s. These substitutions must meet McDonald's quality standards.Fees and PaymentsInitial Franchise Fee: The Franchisee must pay an initial franchise fee of $45,000 USD (or local equivalent).Royalty Fee: A 4% royalty fee on monthly gross sales is payable to McDonald’s.Advertising Fees: The Franchisee must contribute 4% of gross sales annually to McDonald's national advertising fund. Additional local marketing contributions may be required.Other Fees: These may include point-of-sale software, mobile app integration, and self-ordering kiosks, each with associated costs as detailed in the Agreement.DefaultIn the event of default, the Franchisor may issue a written notice to the Franchisee specifying the breach and providing a thirty (30) day period for remediation. Failure to resolve the breach may result in termination.Advertising and MarketingNational Campaigns: The Franchisee must contribute to McDonald's national marketing campaigns, which include TV ads, digital marketing, and global promotions.Local Marketing: Franchisees must run local campaigns in their respective markets to promote the McDonald's brand. Local marketing strategies must be approved by McDonald's to ensure alignment with the overall brand image.Prices of Products

Pricing Guidelines: McDonald’s provides a set pricing structure for its menu items. The Franchisee must follow McDonald's recommended pricing unless otherwise approved.Price Adjustments: Prices are reviewed semi-annually, and McDonald’s reserves the right to adjust prices based on inflation, local market conditions, and cost changes.Method of Paying Products' Value, Expenses & TaxesPayment Terms: Payments to suppliers must be made within 30 days of receipt of goods. Taxes, including VAT, must be paid in accordance with local Egyptian tax laws.Franchise Fees: All franchise-related fees, including royalties and marketing contributions, are due monthly.Submitting a Bank GuaranteeBank Guarantee: The Franchisee is required to submit a bank guarantee of $50,000 USD (or local equivalent) to McDonald's. This guarantee serves as security for the Franchisee’s adherence to the terms of the Agreement.Accounts Bookkeeping & Auditing of Accounts & RecordsAccounting Systems: The Franchisee must maintain accurate financial records, including sales reports, expenses, and inventory logs. McDonald’s may provide software for managing financial data.Audits: McDonald’s reserves the right to audit the Franchisee's financial records and operations to ensure compliance with the franchise agreement. Audits are typically conducted biannually.InsuranceRequired Coverage: The Franchisee must maintain various insurance policies, including:oPublic Liability: Coverage of up to $1,000,000 USD.oProduct Liability: Coverage related to food safety and foodborne illnesses.oEmployee Insurance: Coverage for workplace accidents and injuries.oProperty Insurance: Coverage for restaurant assets, including equipment and inventory.

The Right of InspectionFranchisor's Right: McDonald’s reserves the right to inspect the restaurant and its operations to ensure compliance with the franchise system. This includes unannounced inspections of cleanliness, food safety, and employee training.TrainingInitial Training: The Franchisee and key employees must complete a two-week training program, either in McDonald’s facilities (e.g., Dubai or London) or on-site. The training covers all operational aspects of running a McDonald’s restaurant, from food preparation to customer service.Ongoing Training: The Franchisee is responsible for ensuring that all new employees receive training in food safety and customer service standards. Ongoing training is required to ensure employees maintain McDonald's operational standards.Operation ManualsFranchise Operations Manual: The Franchisee will receive McDonald’s operations manual, which covers all aspects of restaurant management, food preparation, customer service, and operational procedures.Updates: McDonald's reserves the right to update the manual periodically to reflect changes in the brand's systems or regulatory requirements.Intellectual Property and TrademarksTrademark Usage: The Franchisee is granted the right to use McDonald’s trademarks, logos, and other intellectual property in connection with the operation of the franchise.Protection of IP: The Franchisee must protect McDonald’s intellectual property and ensure it is only used in accordance with the guidelines provided.NDA (Non-Disclosure Agreement)Confidentiality: The Franchisee agrees not to disclose McDonald's proprietary information, including recipes, operational methods, and supplier details, to third parties.

Non-Competition ClauseExclusivity: The Franchisee agrees not to operate or invest in competing food service businesses during the term of the franchise and for a period of [number] years after the expiration or termination of the Agreement.Franchisor SupportOperational Support: McDonald's provides ongoing support to the Franchisee, including:oRestaurant Design: Architectural plans and specifications.oMarketing Support: Access to global advertising campaigns and local marketing templates.oTraining: Comprehensive training for new restaurant openings and ongoing staff development.Warranties, Representations, and DisclaimersWarranty: McDonald’s warrants the reliability and effectiveness of its systems but disclaims responsibility for external market conditions affecting restaurant operations.Waiver of the Agreement (Right of First Objection)Termination: Either party may terminate the agreement for cause, and the other party will have a right to cure the breach before the termination becomes final.The Nature of the Relationship Between Franchisor & FranchiseeIndependent Contractor: The Franchisee operates as an independent contractor, bearing all operational risks and expenses, with McDonald's acting as a support and oversight entity.The Degree of Involvement of the FranchisorSupport and Oversight: McDonald's involvement is mainly in providing operational guidance, marketing support, and ensuring adherence to brand standards.

Cases of Agreement TerminationThe Franchise Agreement may be terminated by either party under the following conditions:Failure to Pay Fees: If the Franchisee fails to pay royalties or any other fees owed to McDonald's for more than 30 days.Breach of Agreement: If the Franchisee fails to comply with McDonald's operational, financial, or legal requirements.Failure to Maintain Standards: If the Franchisee does not meet McDonald's quality standards, operational procedures, or customer service requirements.Insolvency or Bankruptcy: If the Franchisee becomes insolvent or files for bankruptcy, McDonald's may terminate the agreement.Franchisee Misconduct: Any illegal activity, fraud, or conduct that harms the McDonald’s brand can result in termination.Effects of Termination or Expiration of the AgreementUpon termination or expiration of the Agreement:Return of Assets: The Franchisee must return all McDonald’s property, including signage, branding, and intellectual property, to the Franchisor.Cessation of Operations: The Franchisee must immediately cease operations under the McDonald’s name and discontinue the sale of McDonald's products.Outstanding Obligations: Any outstanding fees, royalties, or payments must be paid by the Franchisee to McDonald's upon termination.MiscellaneousGoverning Law: The Agreement is governed by the laws of Illinois, USA.Dispute Resolution: Disputes will be resolved through arbitration in Illinois, USA, in accordance with McDonald’s dispute resolution policies.Force Majeure: Neither party will be liable for failure to perform due to events beyond their control, such as natural disasters, government actions, or other unforeseen circumstances.Notices & Correspondences

All official communications related to the franchise agreement must be sent to the following addresses:Franchisor:McDonald's USA, LLC, 110 N. Carpenter Street, Chicago, Illinois 60607, USAFranchisee:[Franchisee’s address in Egypt]Applicable Law & Dispute ResolutionJurisdiction: Any disputes arising out of this Agreement will be resolved under the laws of Illinois, USA.Arbitration: Any legal disputes will be handled through arbitration, with both parties agreeing to resolve issues in the jurisdiction specified by McDonald's.1.Force Majeure:Neither Party shall be liable for failure to perform due to events beyond their control, including natural disasters, government actions, or other unforeseen circumstances.Registration and DisclosureThe Franchisee must comply with all necessary registration and disclosure requirements, including filing with the General Authority for Investment (GAFI) in Egypt, if applicable.The Language of the Agreement and Its CounterpartsThis Agreement is executed in both English and Arabic. Both versions are legally binding, and in case of any conflict, the English version will govern.Number of copies

This Agreement is signed in three original copies:1.One retained by the Franchisor (McDonald's USA, LLC).2.One retained by the Franchisee (Cairo Quick Services, LLC).3.One submitted to the relevant Egyptian authorities for registration.Entire AgreementThis Agreement constitutes the entire understanding between the Parties and supersedes all prior agreements, understandings, or negotiations, whether oral or written. Amendments to this Agreement must be in writing and signed by both Parties.SignatureFranchisor:McDonald's USA, LLCBy: John A. SmithTitle: Vice President, Franchise OperationsDate: December 9, 2024Franchisee:Cairo Quick Services, LLCBy: Ahmed KhalilTitle: Managing DirectorDate: December 9, 2024Contract Documents

List of Products.Trademarks and Intellectual Property.Tools and Equipment.Alternative Products.Marketing Materials.Conditions of the Insurance Policy.Development Plan.Delivery schedule