What is the nature of the franchisee's commitment to develop Crave Cookies businesses under the MUDA?
Crave_Cookies Franchise · 2025 FDDAnswer from 2025 FDD Document
(iii) Crave Cookies Franchising has the right to extend opening deadlines.
**5.
Limitation of Liability.** Franchisee's commitment to develop Crave Cookies businesses is in the nature of an option only.
If Crave Cookies Franchising terminates this MUDA for Franchisee's default, Franchisee shall not be liable to Crave Cookies Franchising for lost future revenues or profits from the unopened Crave Cookies businesses.
Franchisee may terminate this MUDA at any time.
- **6.
Conditions.** Franchisee's right to develop each Crave Cookies franchise after the Store #1 is subject to the following:
(i) Franchisee must possess sufficient financial and organizational capacity to develop, open, operate, and manage each additional Crave Cookies business, in the reasonable judgment of Crave Cookies Franchising, and
(ii) Franchisee must be in full compliance with all brand requirements at its open Crave Cookies businesses, and not in default under any Franchise Agreement or any other agreement with Crave Cookies Franchising.
Source: Item 23 — RECEIPTS (FDD pages 47–194)
What This Means (2025 FDD)
According to Crave Cookies' 2025 Franchise Disclosure Document, a franchisee's commitment to develop multiple Crave Cookies businesses under a Multi-Unit Development Agreement (MUDA) is viewed as an option. While the franchisee agrees to a development schedule, Crave Cookies limits its liability regarding this commitment. Specifically, if Crave Cookies terminates the MUDA due to the franchisee's default, the franchisee will not be held liable for lost future revenues or profits from unopened Crave Cookies locations. The franchisee also has the option to terminate the MUDA at any time.
However, the franchisee's right to develop subsequent Crave Cookies franchises after the initial store is subject to certain conditions. Crave Cookies must deem the franchisee to have sufficient financial and organizational capacity to successfully manage each additional location. Furthermore, the franchisee must be in full compliance with all brand standards at their existing Crave Cookies businesses and must not be in default under any existing Franchise Agreements with Crave Cookies.
Under the MUDA, the franchisee is obligated to locate the first Crave Cookies location within a specific Development Area. Subsequent locations can be opened in any order, provided that each opening deadline is met. It's important to note that the franchisee does not have exclusive rights to develop, open, or operate Crave Cookies businesses within the Development Area. The MUDA can be automatically terminated if the franchisee fails to meet the development schedule or if Crave Cookies has the right to terminate any existing franchise agreement with the franchisee due to default.