Does Desi District include a sample Multi-Unit Development Agreement in the FDD?

Yes, the 2024 Desi District Franchise Disclosure Document includes a sample Multi-Unit Development Agreement (MUDA) as Exhibit C. The MUDA outlines the terms under which a franchisee can develop multiple Desi District businesses. Upon executing the MUDA, the franchisee must pay the total Initial Franchise Fee to Desi District Franchise Group, which is non-refundable.

The MUDA specifies that for the first store, the franchisee and Desi District execute the Franchise Agreement simultaneously with the MUDA. For each additional franchise, the franchisee must execute Desi District's current standard franchise agreement within three business days of leasing or acquiring a location. The MUDA itself does not grant the franchisee the right to operate a Desi District business; this right is only granted through a separate franchise agreement for each location.

Desi District can terminate the MUDA if the franchisee fails to meet the development schedule or if Desi District has the right to terminate any existing franchise agreement with the franchisee due to default. However, the franchisee's commitment is treated as an option, limiting liability for lost future revenues if Desi District terminates the MUDA due to the franchisee's default. The franchisee can also terminate the MUDA at any time.

The franchisee's right to develop additional Desi District franchises after the first store is conditional upon having sufficient financial and organizational capacity and being in full compliance with all brand requirements at their existing Desi District businesses. The laws of Texas govern adversarial proceedings related to the MUDA, and the franchisee cannot transfer the MUDA without Desi District's prior written consent. Certain provisions of the Franchise Agreement, such as those related to dispute resolution and miscellaneous matters, are incorporated into the MUDA.