What criteria must a transferee meet to be approved for a Crave franchise transfer?
Crave Franchise · 2025 FDDAnswer from 2025 FDD Document
a Principal wishes to transfer or permit a transfer of any ownership interest in you, then in each such case (any or all of which are referred to in this Article 14 as a "Restricted Transfer"), transferor and the proposed transferee shall apply to us for our consent. We shall not unreasonably withhold our consent to a Restricted Transfer. We may, in our sole discretion, require any or all of the following as conditions of our approval:
(a) All of the accrued monetary obligations of you or any of your affiliates and all other outstanding obligations to us arising under this Agreement or any other agreement shall have been satisfied in a timely manner and you shall have satisfied all trade accounts and other debts, of whatever nature or kind, in a timely manner;
(b) You and your affiliates shall not be in default of any provision of this Agreement, any amendment hereof or successor hereto, or any other agreement between you or any of your affiliates and us or any of our affiliates at the time of transaction;
(c) The transferor and its principals (if applicable) shall have executed a general release, in a form reasonably satisfactory to us, of any and all claims against us, our officers, directors, shareholders, partners, agents, representatives, independent contractors, servants and employees of each of them, in their corporate and individual capacities, including, without limitation, claims arising under this Agreement and federal, state and local laws, rules and regulations;
(d) The transferee shall demonstrate to our reasonable satisfaction that transferee meets the criteria considered by us when reviewing a prospective franchisee's application for a franchise, including, but not limited to, our educational, managerial and business standards; transferee's good moral character, business reputation and credit rating; transferee's aptitude and ability to conduct the business franchised herein (as may be evidenced by prior related business experience or otherwise); transferee's financial resources and capital for operation of the business; and the geographic proximity and number of other Franchised Businesses owned or operated by transferee;
(e) The transferee shall enter into a written agreement, in a form reasonably satisfactory to us, assuming full, unconditional, joint and several liability for, and agreeing to perform from the date of the transfer, all obligations, covenants and agreements contained in this Agreement; and, if transferee is a corporation or a partnership, transferee's shareholders, partners or other investors, as applicable, shall execute such agreement as transferee's principals and guarantee the performance of all such obligations, covenants and agreements;
(f) The transferee shall execute, for a term ending on the expiration date of this Agreement and with such successor terms as may be provided by this Agreement, the standard form franchise agreement then being offered to new System franchisees and other ancillary agreements as we may require for the Franchised Business, which agreements shall supersede this Agreement and its ancillary documents in all respects and the terms of which agreements may differ from the terms of this Agreement, including, without limitation, the then-current Royalty Fee and Brand Development Fee (as applicable); provided, however, that the transferee shall not be required to pay any initial franchise fee;
(g) The transferee, at its expense, shall renovate, modernize and otherwise upgrade the Franchised Business and, if applicable, any delivery vehicles to conform to the then-current standards and specifications of the System, and shall complete the upgrading and other requirements which conform to the System-wide standards within the time period reasonably specified by us;
(h) The transferor shall remain liable for all of the obligations to us in connection with the Franchised Business incurred prior to the effective date of the transfer and shall execute any and all instruments reasonably requested by us to evidence such liability;
(i) At the transferee's expense, the transferee, the transferee's General Manager and/or any other applicable Franchised Business personnel shall complete any training programs then in effect for franchisees of Crave businesses upon such terms and conditions as we may reasonably require;
(j) When you submit your request for our approval of the transfer, you shall pay to us a transfer fee equal to Five Thousand Dollars ($5,000) to reimburse us for reviewing the application to transfer, including, without limitation, training expenses, legal and accounting fees;
Source: Item 23 — RECEIPTS (FDD pages 63–253)
What This Means (2025 FDD)
According to Crave's 2025 Franchise Disclosure Document, if a franchisee wishes to transfer their interest in the franchised business, assets, or the agreement itself, both the transferor and the proposed transferee must apply to Crave for consent. Crave will not unreasonably withhold consent to a Restricted Transfer. However, Crave may require certain conditions to be met for approval.
The transferee must meet the criteria Crave considers when reviewing a prospective franchisee's application. This includes educational, managerial, and business standards, good moral character, business reputation, and credit rating. The transferee's aptitude and ability to conduct the business, as evidenced by prior related business experience, their financial resources and capital for operation, and the geographic proximity and number of other Crave businesses they own or operate are also considered.
Additionally, the transferee must enter into a written agreement assuming full liability for all obligations in the franchise agreement. If the transferee is a corporation or partnership, its shareholders or partners must guarantee the performance of these obligations. The transferee must also execute the standard form franchise agreement then being offered to new franchisees, which may have different terms, including royalty and brand development fees, although the transferee won't have to pay an initial franchise fee. The transferee is responsible for renovating and upgrading the franchised business to meet current system standards within a timeframe specified by Crave. The transferee, along with their General Manager and other personnel, must complete any training programs in effect for Crave franchisees. Finally, when submitting the transfer request, a transfer fee of $5,000 must be paid to Crave to cover the costs of reviewing the application, including training, legal, and accounting fees.