Who is considered an 'Owner' of a Crave Cookies franchise?
Crave_Cookies Franchise · 2025 FDDAnswer from 2025 FDD Document
l and license others to sell products and services in the Territory through channels of distribution (including the internet) other than Crave Cookies outlets.
- 2.3 Franchisee Control. Franchisee represents that Attachment 1 (i) identifies each owner, officer and director of Franchisee, and (ii) describes the nature and extent of each owner's interest in Franchisee. If any information on Attachment 1 changes (which is not a Transfer), Franchisee shall notify Crave Cookies Franchising within 10 days.
- 2.4 Principal Executive. Franchisee agrees that the person designated as the "Principal Executive" on the Summary Page is the executive primarily responsible for the Business and has
decision-making authority on behalf of Franchisee. The Principal Executive must have at least 10% ownership interest in Franchisee. The Principal Executive does not have to serve as a day-to-day general manager of the Business, but the Principal Executive must devote substantial time and attention to the Business. If the Principal Executive dies, becomes incapacitated, transfers his/her interest in Franchisee, or otherwise ceases to be the executive primarily responsible for the Business, Franchisee shall promptly designate a new Principal Executive, subject to Crave Cookies Franchising's reasonable approval.
- 2.5 Guaranty. If Franchisee is an entity, then Franchisee shall have each Owner sign a personal guaranty of Franchisee's obligations to Crave Cookies Franchising, in the form of Attachment 3.
Source: Item 22 — CONTRACTS (FDD page 47)
What This Means (2025 FDD)
According to Crave Cookies' 2025 Franchise Disclosure Document, an 'Owner' is referenced in several contexts related to the franchise agreement. Specifically, if the franchisee is an entity (like a corporation or LLC), each owner must sign a personal guaranty, ensuring they are personally liable for the franchise's obligations to Crave Cookies. This indicates that anyone with an ownership stake in the franchisee entity is considered an 'Owner' for the purposes of the agreement.
Furthermore, the FDD states that Crave Cookies requires the franchisee to identify each owner, officer, and director, along with the nature and extent of their ownership interest. This information is provided in Attachment 1 of the franchise agreement. Any changes to this information must be reported to Crave Cookies within 10 days, reinforcing the importance of transparency regarding ownership.
Additionally, the document mentions that in the event of the death or incapacity of the franchisee (or the owner with the largest ownership interest if the franchisee is an entity), the business must be transferred within nine months to a third party approved by Crave Cookies or to another person who was an owner at the time of death or incapacity. This highlights that ownership interest plays a crucial role in the continuity and transferability of the Crave Cookies franchise. The Principal Executive must have at least 10% ownership interest in Franchisee.
Before a franchisee (or any Owner) engages in a Transfer (except under Section 15.3, to a co-Owner, or to a spouse, sibling, or child of an Owner), Crave Cookies will have a right of first refusal. Franchisee (or its Owners) shall provide to Crave Cookies a copy of the terms and conditions of any Transfer.