Is a Crave Cookies franchisee obligated to develop additional outlets under the Multi-Unit Development Agreement?
Crave_Cookies Franchise · 2025 FDDAnswer from 2025 FDD Document
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 exclusive right (unless stated otherwise) to establish a mutually-agreed number of additional outlets on a mutually-agreed schedule in a mutually-agreed territory. 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 Crave Cookies business, (3) you must be in compliance with all brand requirements at your open Crave Cookies 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 then-current standards for sites and territories will apply. You are not obligated to develop additional outlets under the MUDA, and you may terminate it any time without penalty. If you do not meet your development schedule in the MUDA, we have the right to terminate your right to develop additional outlets.
Source: Item 12 — TERRITORY (FDD pages 29–31)
What This Means (2025 FDD)
According to Crave Cookies's 2025 Franchise Disclosure Document, a franchisee is not obligated to develop additional outlets even if they sign a Multi-Unit Development Agreement (MUDA). The FDD states that a franchisee may terminate the MUDA at any time without penalty. However, if the franchisee does not meet the development schedule outlined in the MUDA, Crave Cookies has the right to terminate the franchisee's right to develop additional outlets.
This agreement allows franchisees to expand their business by opening multiple Crave Cookies locations within a specific territory. The number of outlets, the development schedule, and the territory are all mutually agreed upon by Crave Cookies and the franchisee. This provides a structured approach to expansion, ensuring that both parties are aligned on the growth strategy.
Several conditions must be met for a franchisee to develop additional outlets under a MUDA. The franchisee must comply with the agreed-upon development schedule, possess sufficient financial and organizational capacity to manage each new Crave Cookies business, adhere to all brand requirements at their existing locations, and remain in compliance with all agreements with Crave Cookies. These conditions ensure that franchisees are well-prepared and capable of successfully operating multiple units, maintaining the brand's standards and reputation.
While the MUDA offers the potential for expansion, it's important to note that Crave Cookies retains control over key aspects such as location approval and adherence to current site and territory standards. This ensures consistency and quality across all franchise locations. The franchisee's right to develop additional outlets can be terminated if the development schedule is not met, highlighting the importance of careful planning and execution.