What is the Crave sublessee's obligation regarding documentation requests from the sublessor related to Landlord's cause for nonpayment?
Crave Franchise · 2025 FDDAnswer from 2025 FDD Document
Should Landlord determine cause for nonpayment of funds, Sublessor shall not be responsible for such funds. Landlord may require Sublessor to provide proof if such cause of this provision if exercised, which Sublessee shall provide to Sublessor without issue. Sublessee acknowledges that failure to do so may impact the ability for Sublessor to receive such funds from Landlord, which will cause non-payment to Sublessee. Such documentation shall be received within fifteen (15) days upon written request. It is expressly understood and agreed to by the parties that the amount specified by the parties is reasonable and Sublessor shall not be liable for any other cost or expense of sublessee seizing operations in the applicable Subleased premises. Upon full amortization of said
initial development costs over the initial Sublease term, the Sublessor, at no time for any reason be held responsible for fees as a result of exercising this provision.
Source: Item 22 — CONTRACTS (FDD pages 62–63)
What This Means (2025 FDD)
According to Crave's 2025 Franchise Disclosure Document, if the Landlord terminates the agreement with the Sublessor (Crave WM Franchising LLC) without cause, the Landlord may be required to reimburse Crave for the unamortized portion of the sublessee's (franchisee) initial improvement costs. If the Landlord determines a cause for nonpayment of these funds, they may require Crave to provide proof. In such a case, the Crave sublessee is obligated to provide the necessary documentation to Crave without issue.
The FDD specifies that the sublessee must provide this documentation to Crave within fifteen (15) days of a written request. The document emphasizes that the sublessee's failure to provide the required documentation may negatively impact Crave's ability to receive funds from the Landlord, which, in turn, would result in non-payment to the sublessee.
This clause highlights the importance of the sublessee's cooperation in providing necessary documentation to ensure that Crave can fulfill its obligations and potentially receive reimbursement from the Landlord. This reimbursement is intended to cover the sublessee's initial investment in improvements to the subleased premises, offering some financial protection in the event of an early termination of the sublease agreement by the Landlord. After the initial development costs are fully paid off over the Sublease term, Crave is not responsible for fees resulting from this provision.