What conditions must a Desi District franchisee meet to develop additional outlets under a MUDA?
Desi_District Franchise · 2024 FDDAnswer from 2024 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 right to establish a mutually-agreed number of additional outlets on a mutually-agreed schedule. 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 Desi District business, (3) you must be in compliance with all brand requirements at your open Desi District 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 38–40)
What This Means (2024 FDD)
According to Desi District's 2024 Franchise Disclosure Document, a franchisee who signs a Multi-Unit Development Agreement (MUDA) gains the right to establish a mutually agreed-upon number of additional outlets based on a mutually agreed schedule. However, this right is contingent upon meeting specific conditions.
The franchisee must adhere to the development schedule outlined in the MUDA. They must also demonstrate sufficient financial and organizational capacity to successfully develop, open, operate, and manage each additional Desi District business. This ensures that the franchisee has the resources and expertise to handle multiple locations effectively.
Furthermore, the franchisee must maintain full compliance with all brand requirements at their existing Desi District businesses. They must not be in default under any agreement with Desi District. These conditions ensure that the franchisee remains in good standing with the franchisor and upholds the brand's standards across all locations. If these conditions are not met, Desi District has the right to terminate the franchisee's right to develop additional outlets under the MUDA.