Can Craters & Freighters unreasonably withhold or delay lease approval?
Craters_Freighters Franchise · 2025 FDDAnswer from 2025 FDD Document
- 4.2 Lease of Premises. Franchisee acknowledges that Franchisor must approve the lease, and any renewal of such lease (collectively, "Lease") for the Premises of the Franchised Business prior to executing such Lease. Franchisor's approval of such Lease cannot be unreasonably withheld or delayed. Franchisee agrees to use Franchisee's best efforts to incorporate into the Lease the terms and conditions set forth in the form of Collateral Assignment of Lease and Addendum, attached hereto as Attachment D to this Agreement. Franchisee acknowledges that Franchisor's approval of the Lease for the Premises does not constitute a guarantee or warranty by Franchisor, express or implied, of the successful operation or profitability of a Craters & Freighters Franchised Business operated at the Premises and indicates only that Franchisor believes the terms and conditions of the Lease fall within the acceptable criteria established by Franchisor as of that time. Franchisee agrees to deliver a copy of the executed Lease to Franchisor within fifteen (15) days after the execution of such Lease.
Source: Item 22 — CONTRACTS (FDD pages 49–50)
What This Means (2025 FDD)
According to the 2025 Craters & Freighters Franchise Disclosure Document, Craters & Freighters's approval of a franchisee's lease cannot be unreasonably withheld or delayed. The franchisee must have Craters & Freighters approve the lease and any renewals before executing it. The franchisee is expected to incorporate specific terms and conditions into the lease, as outlined in the provided Collateral Assignment of Lease and Addendum.
While Craters & Freighters must approve the lease, this approval does not act as a guarantee or warranty of the franchised business's success or profitability at the premises. It only indicates that the lease terms meet Craters & Freighters's established criteria at the time of approval.
The franchisee is responsible for providing Craters & Freighters with a copy of the executed lease within 15 days of its execution. This ensures Craters & Freighters has a record of the lease terms and can confirm compliance with their standards.