What is the Crave franchisee's obligation to develop the Franchised Business?
Crave Franchise · 2025 FDDAnswer from 2025 FDD Document
n sixty (60) days of the receipt of such notice whether you wish to acquire the Development Rights to such additional Franchised Businesses. If you do not exercise this right of first refusal, in whole, we may, following the expiration of the sixty (60) day period, grant the Development Rights to such additional Franchised Businesses to any other person or persons on the same terms and conditions or we may elect to develop, construct and/or operate any of such additional Restaurants or Food Trucks.
SECTION 7 YOUR OBLIGATIONS
You acknowledge and agree that:
7.1 Except as otherwise provided herein, this Agreement includes only the right to select sites for the establishment of Franchised Businesses and to submit the same to us for our approval in accordance with the terms of this Agreement. This Agreement does not include the grant of a license by us to you of any rights to use the Marks, the System, or to open or operate any Franchised Businesses within the Development Area. You shall obtain the license to use such additional rights at each Franchised Business upon the execution of each Franchise Agreement by both you and us and only in accordance with the terms of each Franchise Agreement.
7.2 The Development Rights granted hereunder are personal to you and cannot be sold, assigned, transferred or encumbered, in whole or in part, except as stated in Section 11 hereof.
7.3 Except as provided in Section 6 hereof, the Development Rights granted hereunder are non-exclusive, and we retain the right, in our sole discretion:
7.3.1 To continue to construct and operate other dedicated Crave outlets and to use the System and the Marks at any location outside the Development Area, and to license others to do so.
7.3.2 To develop, use and franchise the rights to any trade names, trademarks, service marks, trade symbols, emblems, signs, slogans, insignia, or copyrights not designated by us as Marks for use with different franchise systems for the sale of the different products or services not in connection with the System at any location, on such terms and conditions as we may deem advisable and without granting you any rights therein.
7.3.3 To develop, merchandise, sell and license others to sell any of our products, proprietary or otherwise, presently existing or to be developed in the future, to the public through alternative distribution channels outside or inside of the Development Area and to use the Marks in connection therewith.
7.4 You have sole responsibility for the performance of all obligations arising out of the operation of your business pursuant to this Agreement, including, but not limited to, the payment when due of any and all taxes levied or assessed by reason of such operation.
7.5 In all public records, in your relationship with other persons, and in any documents, you shall indicate clearly the independent ownership of your business and that the operations of said business are separate and distinct from the operation of a Crave Franchised Business.
7.6 You shall at all times preserve in confidence any and all materials and information furnished or disclosed to you by us and you shall disclose such information or materials only to such of your employees or agents who must have access to it in connection with their employment. You shall not at any time, without our prior written consent, copy, duplicate, record or otherwise reproduce such materials or information, in whole or in part, nor otherwise make the same available to any unauthorized person.
7.7 You shall comply with all requirements of federal, state and local laws, rules and regulations.
7.8 You shall at no time have the right to sub-franchise any of your Development Rights hereunder.
7.9 In no event shall any Franchised Business be opened for business unless and until a Franchise Agreement for such Franchised Business has been fully executed and the initial franchise fee for such Franchised Business has been fully paid.
SECTION 8 OUR SERVICES
We shall, at our expense, provide the following services:
8.1 Review your site selection for conformity to our standards and criteria for selection and acquisition of sites upon our receipt of your written request for approval thereof.
- 8.2 Assist you in determining the layout and configuration of each Franchised Business once the location has been approved. After you and we have determined the layout and configuration of each Franchised Business, you must arrange for site plan and build-out plans and specifications to be prepared and submitted to us for our review and approval.
- 8.3 Review of your site plan and final build-out plans and specifications for conformity to the construction standards and specifications of the System, upon our receipt of your written request for approval thereof.
Source: Item 23 — RECEIPTS (FDD pages 63–253)
What This Means (2025 FDD)
According to Crave's 2025 Franchise Disclosure Document, a franchisee with development rights has the responsibility to select sites for Franchised Businesses and submit them for approval. The grant of development rights does not automatically include a license to use Crave's marks or system, or to operate Franchised Businesses; these rights are secured upon executing each Franchise Agreement. These development rights are personal to the franchisee and cannot be transferred or sold, except as specified in the agreement. Crave retains the right to construct and operate other Crave outlets outside the Development Area and to license others to do so. They can also develop and franchise other trade names or trademarks not designated as Crave's marks for different products or services. Additionally, Crave can sell their products through alternative distribution channels, both inside and outside the Development Area.
The franchisee is solely responsible for all obligations arising from the operation of their business, including the payment of all applicable taxes. They must clearly indicate the independent ownership of their business in all public records and interactions, ensuring it is distinct from Crave's operations. The franchisee is obligated to maintain the confidentiality of all materials and information provided by Crave, disclosing it only to employees or agents who require access for their work. Copying or reproducing these materials without prior written consent is prohibited, and franchisees must comply with all federal, state, and local laws, rules, and regulations.
A Crave franchisee cannot open a Franchised Business until a Franchise Agreement is fully executed and the initial franchise fee is paid. The approval of a site by Crave does not guarantee the success or profitability of the Franchised Business at that location. The franchisee can enter into the initial or subsequent Franchise Agreements using a newly formed entity, such as an LLC or corporation, provided that the franchisee also signs the agreement as a principal. For each subsequent Franchise Agreement, the franchisee must request the current Franchise Disclosure Document, submit all required information and documents, provide financial statements, and meet Crave's current financial criteria.