Does the termination of a Multi-Unit Development Agreement with a Chocolate Bash franchisee give CB Franchising the right to terminate the franchise agreement?

According to the 2024 Chocolate Bash Franchise Disclosure Document, the termination of a Multi-Unit Development Agreement with a franchisee or its affiliate does not automatically give CB Franchising the right to terminate the Franchise Agreement. This is explicitly stated as an exception to the general rule that termination of any other agreement between CB Franchising and the franchisee can be grounds for terminating the Franchise Agreement.

This provision protects franchisees who have entered into a separate agreement to develop multiple Chocolate Bash locations. If the development agreement is terminated for any reason, the franchisee's existing Chocolate Bash franchise is not necessarily jeopardized. This offers a degree of security to franchisees who may face challenges in fulfilling their development obligations.

However, it is important to note that other circumstances, such as multiple notices of default within a 12-month period or actions that unfavorably affect the Chocolate Bash brand, can still lead to the termination of the Franchise Agreement. Therefore, franchisees must remain compliant with all other terms and conditions of the agreement to maintain their franchise rights.