Can Crave require a general release of claims as a condition of transfer approval?
Crave Franchise · 2025 FDDAnswer from 2025 FDD Document
replacing, upgrading or otherwise dealing with such assets as required or permitted by this Agreement), without our prior written consent. Any purported assignment or transfer, by operation of law or otherwise, made in violation of this Agreement shall be null and void and shall constitute a material event of default under this Agreement.
14.2.2 If you wish to transfer all or part of your interest in the Franchised Business, any of the Franchised Business' material assets (except as provided in Section 14.2.1 above) or this Agreement,
or if you or a Principal wishes to transfer or permit a transfer of any ownership interest in you, then in each such case (any or all of which are referred to in this Article 14 as a "Restricted Transfer"), transferor and the proposed transferee shall apply to us for our consent. We shall not unreasonably withhold our consent to a Restricted Transfer.
Source: Item 23 — RECEIPTS (FDD pages 63–253)
What This Means (2025 FDD)
According to Crave's 2025 Franchise Disclosure Document, Crave can require a general release of claims as a condition of transfer approval. Specifically, if a franchisee wishes to transfer their interest in the Franchised Business, its assets, or the Franchise Agreement, both the transferor and the proposed transferee must apply to Crave for consent. Crave states that it will not unreasonably withhold consent to a Restricted Transfer.
As a condition of approval, Crave may require the transferor and its principals to execute a general release. This release must be in a form reasonably satisfactory to Crave, and it covers any and all claims against Crave, its officers, directors, shareholders, partners, agents, representatives, independent contractors, servants, and employees, in their corporate and individual capacities. The claims include, but are not limited to, those arising under the Franchise Agreement and federal, state, and local laws, rules, and regulations.
This means that a franchisee seeking to transfer their Crave franchise may be required to waive any existing or potential legal claims against Crave as part of the transfer process. This is a fairly standard practice in franchising, as it protects the franchisor from future litigation related to the franchise agreement. However, franchisees should carefully consider the implications of such a release and consult with an attorney before signing, as it could prevent them from pursuing legitimate claims against Crave.