How is the purchase price for a Crave franchise business paid?
Crave Franchise · 2025 FDDAnswer from 2025 FDD Document
14.8.1 At any time during the term of this Agreement, we shall have the right to purchase the Franchised Business from you by giving you written notice that we are exercising our option to purchase the Franchised Business pursuant to this Section 14.8. The purchase of the Franchised Business shall include, without limitation, leasehold improvements, equipment, furniture, fixtures, signs, inventory and the lease or sublease for the Accepted Location. We shall have the unrestricted right to assign this option to purchase. We or our assignee shall be entitled to all customary warranties and representations given by the seller of a business including, without limitation, representations and warranties as to (a) ownership, condition and title to assets; (b) liens and encumbrances relating to the assets; (c) validity of contracts inuring to us or affecting the assets; and (d) contingent or other liabilities.
14.8.2 The purchase price for the assets of the Franchised Businessshall be the fair market value determined as of the date of our written notice to you in a manner consistent with reasonable depreciation of leasehold improvements owned by you and the equipment, furniture, fixtures, signs and inventory of the Franchised Business. The purchase price shall not contain any factor or increment for any trademark, service mark or other commercial symbol used in connection with the operation of the Franchised Business, or goodwill or "going concern" value for the Franchised Business. We may exclude from the assets purchased hereunder any equipment, furniture, fixtures, signs and inventory that are not approved as meeting quality standards for Crave businesses. The length of the remaining term of the lease or sublease for the Accepted Location shall also be considered in determining the fair market value hereunder. If we and you are unable to agree on the fair market value of the assets, the fair market value shall be determined by an independent appraiser selected by us and you. If we and you are unable to agree on an appraiser, we shall each select one (1) appraiser who shall select a third appraiser and the fair market value shall be deemed to be the average of the three (3) independent appraisals. Nothing contained herein
Source: Item 23 — RECEIPTS (FDD pages 63–253)
What This Means (2025 FDD)
According to Crave's 2025 Franchise Disclosure Document, the franchisor has the right to purchase a franchised business from a franchisee during the term of the agreement. The purchase includes leasehold improvements, equipment, furniture, fixtures, signs, inventory, and the lease or sublease for the location.
The purchase price for the assets will be the fair market value, determined on the date of written notice, considering reasonable depreciation of leasehold improvements, equipment, furniture, fixtures, signs, and inventory. The price will not include any value for trademarks, service marks, commercial symbols, goodwill, or "going concern" value. Crave may exclude items that do not meet their quality standards. The remaining term of the lease will also factor into the fair market value.
If Crave and the franchisee cannot agree on the fair market value, an independent appraiser will determine it. If they can't agree on an appraiser, each party will select one appraiser, and those two will select a third. The fair market value will then be the average of the three appraisals. This process ensures a structured approach to determining the purchase price if Crave exercises its right to buy back a franchise.