What event triggers the deadline for executing the franchise agreement for additional Chocolate Bash franchises?
Chocolate_Bash Franchise · 2024 FDDAnswer from 2024 FDD Document
- 2. Form of Agreement. For Store #1, Franchisee and CB Franchising have executed the Franchise Agreement simultaneously with this MUDA. For each additional Chocolate Bash franchise, Franchisee shall execute CB Franchising's then-current standard form of franchise agreement no later than three business days after Franchisee leases or acquires a location. This MUDA does not give Franchisee the right to construct, open, or operate a Chocolate Bash business, and Franchisee acknowledges that Franchisee may construct, open, and operate each Chocolate Bash business only pursuant to a separate franchise agreement executed pursuant to this MUDA for each such Chocolate Bash business.
Source: Item 23 — RECEIPTS (FDD pages 39–101)
What This Means (2024 FDD)
According to Chocolate Bash's 2024 Franchise Disclosure Document, franchisees entering into a Multi-Unit Development Agreement (MUDA) must adhere to specific timelines for opening multiple locations. For the initial store, the Franchise Agreement is executed simultaneously with the MUDA. However, for each subsequent Chocolate Bash franchise, the franchisee is required to execute the then-current standard form of the franchise agreement within three business days after leasing or acquiring a location.
This stipulation means that a Chocolate Bash franchisee needs to be prepared to act quickly once a location is secured. Failing to execute the franchise agreement within the specified three-day window could potentially jeopardize the franchisee's right to develop that location. This requirement underscores the importance of having legal and financial resources readily available to finalize the agreement promptly.
It is important to note that the MUDA itself does not grant the franchisee the right to open or operate a Chocolate Bash business. Each location requires a separate franchise agreement. This condition ensures that Chocolate Bash maintains control over the quality and standards of each franchise location, and that each new location is subject to the current franchise terms and conditions.