What is the Multi-Unit Development Agreement for Chocolate Fish Coffee referred to as in this document?
Chocolate_Fish_Coffee Franchise · 2024 FDDAnswer from 2024 FDD Document
This Multi-Unit Development Agreement (this "MUDA") is made between Chocolate Fish Franchising, LLC, a Wyoming Limited Liability Company ("Chocolate Fish Franchising") and , a ("Franchisee") on the Effective Date. Background Statement: On the same day as they execute this MUDA, Chocolate Fish Franchising and Franchisee have entered into a Franchise Agreement for the franchise of a Chocolate Fish Coffee business (the "Franchise Agreement"; capitalized terms used but not defined in this MUDA have the meanings given in the Franchise Agreement). Chocolate Fish Franchising and Franchisee desire that Franchisee develop multiple Chocolate Fish Coffee businesses.
Source: Item 23 — RECEIPTS (FDD pages 41–119)
What This Means (2024 FDD)
According to Chocolate Fish Coffee's 2024 Franchise Disclosure Document, the Multi-Unit Development Agreement is referred to as the "MUDA". This agreement is made between Chocolate Fish Franchising, LLC, and the franchisee. The document states that on the same day the MUDA is executed, Chocolate Fish Franchising and the franchisee will enter into a Franchise Agreement for a Chocolate Fish Coffee business. The purpose of the MUDA is to allow the franchisee to develop multiple Chocolate Fish Coffee businesses.
Prospective franchisees should note that capitalized terms within the MUDA, but not specifically defined in it, will have the same meanings as defined in the Franchise Agreement. This means understanding the Franchise Agreement is crucial before signing the MUDA. The MUDA outlines the development schedule and associated fees for opening multiple Chocolate Fish Coffee locations.
Furthermore, the MUDA includes conditions under which Chocolate Fish Franchising can terminate the agreement, such as failure to meet the development schedule or default under any franchise agreement. However, the document also states that the franchisee's commitment is in the nature of an option, limiting liability for lost future revenues if Chocolate Fish Franchising terminates the MUDA for the franchisee's default. The franchisee also has the option to terminate the MUDA at any time.