When is the Crave Successor Agreement Fee due?
Crave Franchise · 2025 FDDAnswer from 2025 FDD Document
| (1) | (2) | (3) | (4) |
|---|---|---|---|
| Fees (1) | Amount | Due Date | Remarks |
| Interest | 18% per annum or the highest interest rate allowed by applicable law, whichever is greater | On demand | Interest may be charged on all overdue amounts. Interest accrues from the original due date until payment is received in full. |
| Audit Fee | Cost of audit (estimated to be between $1,000 and $5,000) | When billed | Payable only if we find, after an audit, that you have understated Gross Sales by 2% or more or you have understated any amount you owe to us. You must also pay the understated amount plus interest. |
| Insufficient Funds Fee | $100 per occurrence | On demand, if incurred | Payable if there are insufficient funds in your account to pay fees due to us. If you incur three insufficient funds fees in any 12-month period, we have the right to terminate your Franchise Agreement. |
| Transfer Fee – Transfer Between Owners | $5,000 | With request for approval of transfer | For any transfer of ownership interests or shares between the owners of the franchise, or if you are adding a new owner (as long as majority ownership does not change). |
| Transfer Fee – Franchise Agreement | $5,000 | With request for approval of transfer | No fee charged for a one time transfer from individual(s) to a corporate entity formed for convenience of ownership of the franchise. |
| Transfer Fee – Multi Unit Development Agreement | $5,000 | With request for approval of transfer | No fee charged for a one time transfer from individual(s) to a corporate entity formed for convenience of ownership of the franchise. |
| Successor Agreement Fee | $5,000 | Upon signing of t |
Source: Item 6 — OTHER FEES (FDD pages 12–19)
What This Means (2025 FDD)
According to Crave's 2025 Franchise Disclosure Document, the Successor Agreement Fee is $5,000 and is due upon signing the successor Franchise Agreement. This fee is incurred when a franchisee chooses to renew their franchise agreement for another term. Unlike some other fees which may be subject to change, the FDD does not indicate any conditions under which this fee might increase.
Successor agreements are common in franchising, as the initial franchise agreement has a set term, often 10 years. If a Crave franchisee wishes to continue operating their location after the initial term, they must sign a new agreement and pay the Successor Agreement Fee. This fee compensates Crave for the administrative costs associated with renewing the franchise agreement and ensuring the franchisee continues to meet brand standards.
It is important for prospective Crave franchisees to factor this fee into their long-term financial planning. While $5,000 may not seem significant compared to the initial franchise fee or ongoing royalty payments, it is an additional cost that must be considered when evaluating the overall profitability of the franchise over its entire lifespan. Franchisees should also inquire about any other potential costs associated with renewing the franchise agreement, such as required remodels or upgrades to meet current brand standards.