Can Crave assign its option to purchase a franchised business?
Crave Franchise · 2025 FDDAnswer from 2025 FDD Document
14.8.1 At any time during the term of this Agreement, we shall have the right to purchase the Franchised Business from you by giving you written notice that we are exercising our option to purchase the Franchised Business pursuant to this Section 14.8. The purchase of the Franchised Business shall include, without limitation, leasehold improvements, equipment, furniture, fixtures, signs, inventory and the lease or sublease for the Accepted Location. We shall have the unrestricted right to assign this option to purchase. We or our assignee shall be entitled to all customary warranties and representations given by the seller of a business including, without limitation, representations and warranties as to (a) ownership, condition and title to assets; (b) liens and encumbrances relating to the assets; (c) validity of contracts inuring to us or affecting the assets; and (d) contingent or other liabilities.
14.8.2 The purchase price for the assets of the Franchised Businessshall be the fair market value determined as of the date of our written notice to you in a manner consistent with reasonable depreciation of leasehold improvements owned by you and the equipment, furniture, fixtures, signs and inventory of the Franchised Business. The purchase price shall not contain any factor or increment for any trademark, service mark or other commercial symbol used in connection with the operation of the Franchised Business, or goodwill or "going concern" value for the Franchised Business. We may exclude from the assets purchased hereunder any equipment, furniture, fixtures, signs and inventory that are not approved as meeting quality standards for Crave businesses. The length of the remaining term of the lease or sublease for the Accepted Location shall also be considered in determining the fair market value hereunder. If we and you are unable to agree on the fair market value of the assets, the fair market value shall be determined by an independent appraiser selected by us and you. If we and you are unable to agree on an appraiser, we shall each select one (1) appraiser who shall select a third appraiser and the fair market value shall be deemed to be the average of the three (3) independent appraisals. Nothing contained herein
Source: Item 23 — RECEIPTS (FDD pages 63–253)
What This Means (2025 FDD)
According to Crave's 2025 Franchise Disclosure Document, Crave has the right to purchase a franchised business at any time during the term of the agreement. As part of this right, Crave has the unrestricted right to assign its option to purchase the franchise to another party. This means Crave can transfer its right to buy the business to someone else without needing the franchisee's approval.
If Crave exercises its option to purchase the franchise, the purchase includes leasehold improvements, equipment, furniture, fixtures, signs, inventory, and the lease or sublease for the location. The purchase price will be the fair market value of these assets, determined as of the date of Crave's written notice to the franchisee. The purchase price will not include any value for trademarks, service marks, goodwill, or the business as a going concern. Crave can also exclude any assets that don't meet its quality standards.
Fair market value will be determined jointly between Crave and the franchisee. If they cannot agree, an independent appraiser will determine the value. If they still cannot agree, each party will select an appraiser, and those two appraisers will select a third. The average of the three appraisals will then determine the fair market value. This valuation process ensures that the franchisee receives a fair price for the business assets in the event of a purchase by Crave or its assignee.
This right to purchase and assign provides Crave with flexibility in managing its franchise network. It allows Crave to transfer ownership to a new party without direct involvement, potentially streamlining transitions and network management. For a prospective franchisee, this means that the future ownership of their business could change, with Crave assigning its purchase option to an outside party who may then acquire the franchise.