What happens if a Crave franchisee fails to make the required modifications to their Franchised Business after being notified during the successor term?
Crave Franchise · 2025 FDDAnswer from 2025 FDD Document
- 3.2.4 After we have received from you all executed Successor Franchise Documents and the successor agreement fee, we shall inspect your Franchised Business to determine the extent of any required updating, remodeling, redecorating or other refurbishment for the Franchised Business in order to bring the Franchised Business up to our then-current image and standards for new Crave outlets. We will provide notice to you of the modifications you shall be required to make, and you shall have six (6) months from the date of such notice to effectuate such modifications. If you fail or refuse to make the required modifications, we shall have the right to terminate the Successor Franchise Documents.
Source: Item 23 — RECEIPTS (FDD pages 63–253)
What This Means (2025 FDD)
According to Crave's 2025 Franchise Disclosure Document, if a franchisee fails or refuses to make the required modifications to their Franchised Business after receiving notice during the successor term, Crave retains the right to terminate the Successor Franchise Documents. This means that the agreement for the extended franchise period can be cancelled by Crave if the franchisee does not comply with the required updates, remodeling, redecorating, or other refurbishment needed to meet Crave's current image and standards.
This provision is significant for prospective franchisees as it emphasizes the importance of maintaining Crave's brand standards throughout the franchise term, including any successor terms. Franchisees need to be prepared to invest in updates and modifications to keep their business aligned with Crave's evolving image. The franchisee has six months to complete the modifications from the date of the notice.
The potential termination of the Successor Franchise Documents could have serious financial and operational consequences for the franchisee. It highlights the need for franchisees to carefully consider the costs associated with these required modifications and to ensure they have the resources to comply within the specified timeframe. Failing to do so could result in the loss of their franchise and the associated revenue stream.
It is important for potential Crave franchisees to discuss the scope and frequency of required modifications with Crave during their due diligence process. Understanding the potential costs and timelines associated with these updates will help franchisees make informed decisions about their investment and ability to maintain compliance throughout the term of the franchise agreement and any successor terms.