The franchise agreement is the legal agreement executed between the franchisor and franchisee that creates the legal foundation for the franchise relationship. Franchises require an initial investment, ongoing fees, and working capital.So, you have your Franchise Disclosure Documents ("FDD") and other related agreements in order and ready to start selling your newly created franchise system. Any prospective franchisee should first get to know the Franchisor and its officers. The two primary documents you'll create are the Franchise Agreement and the Franchise Disclosure Document (FDD). The Franchise Agreement. Initially drafting a compliant Franchise Disclosure Document ("FDD") is a timeintensive process. Item 12 and the "territory" provisions in the franchise agreement describe whether the franchisor and other franchisees can compete with you. This Disclosure Document summarizes certain provisions of your license agreement and other information in plain English. Show your contract and this disclosure document to an advisor, like a lawyer or an accountant.