What is the duration of the lease term for a Crave franchise under the Commercial Sub-Lease Agreement?
Crave Franchise · 2025 FDDAnswer from 2025 FDD Document
Article III Lease Term, Extension, Expiration and Surrender
- 1. Lease Term: The Lease Term shall be one, ten (10) year term and shall terminate on the tenth, (10), anniversary of the rent commencement date.
- 2. Landlord Buyout Provision: 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. It is expressly understood and agreed to by the parties that the amount specified by the parties is reasonable and Sublessor shall not be liable for any other cost or expense of sublessee seizing operations in the applicable Subleased premises. Upon full amortization of said
initial development costs over the initial Sublease term, the Sublessor, at no time for any reason be held responsible for fees as a result of exercising this provision.
Source: Item 22 — CONTRACTS (FDD pages 62–63)
What This Means (2025 FDD)
According to Crave's 2025 Franchise Disclosure Document, the lease term for the Commercial Sub-Lease Agreement is one ten-year term. The lease will terminate on the tenth anniversary of the rent commencement date.
However, there is a Landlord Buyout Provision. The landlord may, without cause, terminate the agreement with the landlord and Crave regarding the location at any time with ninety days prior written notice. If this termination occurs during the initial term of the sublease, the landlord will reimburse Crave for the unamortized portion of the franchisee's improvements to the subleased premises, calculated on a straight-line depreciation basis over the initial sublease term. Crave will then pay these funds to the franchisee.
If the landlord determines there is cause for nonpayment of funds, Crave will not be responsible for such funds. Crave may require the franchisee to provide proof if this provision is exercised, and failure to do so may impact Crave's ability to receive funds from the landlord, which will cause non-payment to the franchisee. Upon full amortization of the initial development costs over the initial sublease term, Crave will not be held responsible for fees resulting from the exercise of this provision.