What is the deadline for the Crave Sublessee to provide documentation to the Sublessor upon written request regarding the Landlord buyout?
Crave Franchise · 2025 FDDAnswer from 2025 FDD Document
As per agreement with the Landlord and the Sublessor, Landlord may, without cause, at any time, terminate the agreement with Landlord and Sublessor regarding the location in this Agreement with a prior ninety (90) days written notice. In the event such termination shall take place during the initial term of this sublease, Landlord shall reimburse sublessor for initial unamortized portion of the cost of sublessee's improvements to the subleased premises, calculated on a straight-line depreciation basis over said initial sublease term. Sublessor shall pay sublessee such funds, received from Landlord. Should Landlord determine cause for nonpayment of funds, Sublessor shall not be responsible for such funds. Landlord may require Sublessor to provide proof if such cause of this provision if exercised, which Sublessee shall provide to Sublessor without issue. Sublessee acknowledges that failure to do so may impact the ability for Sublessor to receive such funds from Landlord, which will cause non-payment to Sublessee. Such documentation shall be received within fifteen (15) days upon written request.
Source: Item 22 — CONTRACTS (FDD pages 62–63)
What This Means (2025 FDD)
According to Crave's 2025 Franchise Disclosure Document, a sublessee must provide documentation to the sublessor within fifteen days of a written request regarding a Landlord buyout. Specifically, this situation arises if the Landlord terminates the agreement with the Landlord and Sublessor, potentially triggering a reimbursement to the sublessee for the unamortized portion of their initial improvements.
This requirement is crucial because the sublessee's failure to provide the necessary documentation within the 15-day timeframe could impact the sublessor's ability to receive funds from the Landlord. If the sublessor doesn't receive these funds due to the sublessee's delay, the sublessee may not be reimbursed for their initial investment in the subleased premises. This creates a direct financial risk for the sublessee, as their reimbursement is contingent on their timely response to the sublessor's documentation requests.
Furthermore, the FDD clarifies that the sublessor is not responsible for these funds if the Landlord determines cause for nonpayment. However, the sublessor is obligated to pay the sublessee the funds received from the Landlord. This arrangement highlights the importance of clear communication and cooperation between the sublessee and sublessor to ensure a smooth process in the event of a Landlord buyout. The sublessee should maintain organized records of all improvements and related costs to facilitate a quick response to any potential requests for documentation.