What agreement is required for a Crab N Spice franchisee to establish additional franchised outlets?
Crab_N_Spice Franchise · 2024 FDDAnswer from 2024 FDD Document
due to circumstances beyond your control.
You do not have the right to establish additional franchised outlets unless you sign a Multi-Unit Development Agreement ("MUDA") in the form attached as Exhibit C to this disclosure document. If you and we sign a MUDA, then you will have the right establish a mutually-agreed number of additional outlets. Under the MUDA, your right to develop additional outlets is subject to (1) you must comply with the mutually-agreed development schedule, (2) you must have sufficient financial and organizational capacity to develop, open, operate, and manage each additional Crab N Spice business, (3) you must be in compliance with all brand requirements at
your open Crab N Spice business(es), and (4) you must not be in default under any other agreement with us. We will approve the location of future sites and territories for those sites, and our thencurrent standards for sites and territories will apply.
Source: Item 12 — TERRITORY (FDD pages 27–28)
What This Means (2024 FDD)
According to the 2024 Crab N Spice Franchise Disclosure Document, a franchisee does not have the right to establish additional franchised outlets unless they sign a Multi-Unit Development Agreement (MUDA). This agreement, in the form attached as Exhibit C to the FDD, grants the franchisee the right to establish a mutually-agreed number of additional outlets.
Under the MUDA, the franchisee's right to develop additional Crab N Spice outlets is contingent upon several factors. These include compliance with a mutually-agreed development schedule, having sufficient financial and organizational capacity to develop, open, operate, and manage each additional Crab N Spice business, compliance with all brand requirements at their existing Crab N Spice businesses, and not being in default under any other agreement with Crab N Spice.
Crab N Spice will approve the location of future sites and territories for those sites, and their then-current standards for sites and territories will apply. For each additional Crab N Spice franchise, the franchisee must execute Crab N Spice's then-current standard form of franchise agreement no later than three business days after the franchisee leases or acquires a location. This acknowledges that the franchisee may only construct, open, and operate each Crab N Spice business pursuant to a separate franchise agreement executed pursuant to the MUDA for each such Crab N Spice business.