What payments to Crave can be withdrawn from the franchisee's designated bank account via electronic funds transfer (EFT)?
Crave Franchise · 2025 FDDAnswer from 2025 FDD Document
By executing this Agreement, you agree that we shall have the right to withdraw funds from your designated bank account by electronic funds transfer ("EFT") in the amount of the Royalty Fee, Brand Development Fee, and any other payments due to us and/or our affiliates. If you do not provide the Royalty Report when required, we may debit your account for one hundred twenty percent (120%) of the last Royalty Fee and Brand Development Fee (if applicable) that we debited. If the Royalty Fee and Brand Development Fee we debit are less than the Royalty Fee and Brand Development Fee you actually owe to us, once we have been able to determine the Franchised Business' true and correct Gross Sales, we will debit your account for the balance on a day we specify. If the Royalty Fee and Brand Development Fee we debit are greater than the Royalty Fee and Brand Development Fee you actually owe, we will credit the excess against the amount we otherwise would debit from your account during the following week. You shall, upon execution of this Agreement or at any time thereafter at our request, execute such documents or forms as we or your bank determine are necessary for usto process EFTsfrom your designated bank account for the payments due hereunder. If payments are not received when due, interest may be charged by us in accordance with Section 4.5 below. Upon written notice to you, you may be required to pay such fees directly to us in lieu of EFT, at our sole discretion.
Source: Item 23 — RECEIPTS (FDD pages 63–253)
What This Means (2025 FDD)
According to Crave's 2025 Franchise Disclosure Document, franchisees agree to allow Crave to withdraw funds from their designated bank account via electronic funds transfer (EFT) for several types of payments. These include the Royalty Fee, Brand Development Fee, and any other payments due to Crave or its affiliates. This means that Crave has the authorization to directly debit the franchisee's account for these fees as they become due, simplifying the payment process.
If a franchisee fails to provide the required Royalty Report, Crave may debit the franchisee's account for 120% of the last Royalty Fee and Brand Development Fee (if applicable) that was debited. This acts as a penalty for non-compliance and ensures that Crave receives at least an estimated payment in the absence of an accurate report. Once the true Gross Sales are determined, Crave will adjust the debit accordingly, either debiting the remaining balance or crediting any excess to the franchisee's account during the following week.
To facilitate these EFT transactions, franchisees must execute any documents or forms that Crave or the franchisee's bank deems necessary. This ensures that the proper authorizations are in place for Crave to process the electronic fund transfers. Crave also retains the right to require franchisees to pay fees directly instead of using EFT, at their sole discretion, providing flexibility in payment methods. If payments are not received when due, Crave may charge interest on the overdue amounts.
This arrangement offers convenience for both Crave and the franchisee, but it also places a responsibility on the franchisee to maintain accurate records and submit timely reports to avoid penalties or discrepancies in the amounts debited. Franchisees should ensure they understand the reporting requirements and payment schedules to manage their cash flow effectively and avoid any potential issues with EFT withdrawals.