Does the Chocolate Fish Coffee Multi-Unit Development Agreement address renewal or extension of the term?
Chocolate_Fish_Coffee Franchise · 2024 FDDAnswer from 2024 FDD Document
reements attached to this disclosure document.**
| Provision | Section in franchise | Summary |
|---|---|---|
| or other agreement | ||
| a. Length of the franchise | Franchise | 10 years from date of franchise agreement. |
| term | ||
| Agreement (FA): § | ||
| 3.1 | ||
| Multi-Unit | ||
| Development | ||
| Agreement | ||
| (MUDA): none | ||
| b. Renewal or extension | FA: § 3.2 | For our franchise system, “renewal” means that |
| of the term | ||
| MUDA: none | at the end of your term, you sign our successor | |
| franchise agreement for an additional term. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION (FDD pages 33–36)
What This Means (2024 FDD)
According to Chocolate Fish Coffee's 2024 Franchise Disclosure Document, the Multi-Unit Development Agreement (MUDA) does not contain specific provisions for renewal or extension of the term. The FDD indicates that the franchise agreement lasts for 10 years from the date of the agreement. For a standard franchise agreement, "renewal" means that at the end of the term, the franchisee signs Chocolate Fish Coffee's successor franchise agreement for an additional term, which may contain materially different terms and conditions.
To renew a Chocolate Fish Coffee franchise, a franchisee must provide advance notice, comply with all contractual obligations to Chocolate Fish Coffee and third parties, renovate to Chocolate Fish Coffee's then-current standards, sign the then-current form of franchise agreement and related documents (including a personal guaranty), and sign a general release (unless prohibited by applicable law). If a franchisee continues operating their franchise after the expiration of the term without a renewal agreement, Chocolate Fish Coffee may either terminate the operation at any time or deem the agreement to have been renewed for an additional term.
However, the table in Item 17 explicitly states "MUDA: none" under the "Renewal or extension of the term" provision. This means the terms and conditions for renewing or extending a single Chocolate Fish Coffee franchise agreement do not apply to the Multi-Unit Development Agreement. A prospective franchisee should clarify with Chocolate Fish Coffee the terms for extending the development schedule or entering into new franchise agreements for additional locations beyond the initial development term outlined in the MUDA.