According to Crave's 2025 Franchise Disclosure Document, the enforceability of termination provisions related to bankruptcy in the Franchise Agreement is not absolute. Specifically, the addendum to the Franchise Agreement required by the state of Maryland indicates that provisions allowing for termination upon the franchisee's bankruptcy may not be enforceable under federal bankruptcy law. This is due to the complexities and protections afforded by federal bankruptcy statutes (11 U.S.C. Section 101 et seq.).

This means that if a Crave franchisee in Maryland files for bankruptcy, Crave's ability to automatically terminate the franchise agreement is questionable. Federal bankruptcy law could override the terms of the franchise agreement, potentially allowing the franchisee to reorganize their finances and continue operating the franchise. This protection exists to give debtors a chance to rehabilitate their financial situation.

For a prospective Crave franchisee, this information is crucial for understanding the risks and protections associated with the franchise agreement, especially in Maryland. It highlights the importance of consulting with legal counsel to fully understand the implications of bankruptcy laws on the franchise agreement and to assess the potential for business continuity even in times of financial distress. Franchisees should be aware that standard contractual terms can be superseded by federal law designed to protect debtors.