What specific claims, demands, or damages does a Crave franchisee waive in the event of a sale, assignment, or disposition by Crave Franchising, LLC?
Crave Franchise · 2025 FDDAnswer from 2025 FDD Document
You expressly affirm and agree that we may sell our assets, our rights to the Marks or to the System outright to a third party; may go public; may engage in a private placement of some or all of our securities; may merge, acquire other corporations, or be acquired by another corporation; may undertake a refinancing, recapitalization, leveraged buyout or other economic or financial restructuring; and, with regard to any or all of the above sales, assignments and dispositions, you expressly and specifically waive any claims, demands or damages arising from or related to the loss of said Marks (or any variation thereof) and/or the loss of association with or identification of "CRAVE Franchising, LLC" as Franchisor. Nothing contained in this Agreement shall require us to remain in the food service business or to offer the same products and services, whether or not bearing the Marks, in the event that we exercise our right to assign our rights in this Agreement.
Source: Item 23 — RECEIPTS (FDD pages 63–253)
What This Means (2025 FDD)
According to Crave's 2025 Franchise Disclosure Document, a franchisee expressly waives specific claims, demands, or damages in the event of certain actions by Crave Franchising, LLC. Specifically, if Crave sells its assets, rights to its trademarks, or the Crave system to a third party, goes public, engages in a private placement of securities, merges with or is acquired by another corporation, or undertakes financial restructuring, the franchisee waives any claims, demands, or damages related to the loss of the trademarks or the loss of association with Crave Franchising, LLC as the franchisor. This waiver is a significant consideration for potential franchisees.
This waiver means that if Crave were to be acquired by another company, and that new company decided to rebrand or change the franchise system, franchisees would not be able to sue for damages related to the loss of the Crave brand or the association with the original franchisor. This could include potential loss of business or perceived value due to the change. The FDD also states that Crave is not required to remain in the food service business or offer the same products and services if they assign their rights in the agreement.
This type of waiver is not uncommon in franchising, as it allows the franchisor flexibility in making business decisions without the threat of legal action from franchisees. However, it does place a certain level of risk on the franchisee, as the value of their franchise is tied to the franchisor's brand and system. Prospective franchisees should carefully consider this waiver and its potential impact on their investment before signing the franchise agreement. They may want to seek legal advice to fully understand the implications of this provision.