Are Crave Cookies franchisees and their owners allowed to be direct or indirect owners of any competitor?
Crave_Cookies Franchise · 2025 FDDAnswer from 2025 FDD Document
- 2.6 No Conflict. Franchisee represents to Crave Cookies Franchising that Franchisee and each of its Owners (i) are not violating any agreement (including any confidentiality or non-competition covenant) by entering into or performing under this Agreement, (ii) are not a direct or indirect owner of any Competitor, and (iii) are not listed or "blocked" in connection with, and are not in violation under, any anti-terrorism law, regulation, or executive order.
Source: Item 22 — CONTRACTS (FDD page 47)
What This Means (2025 FDD)
According to the 2025 Crave Cookies Franchise Disclosure Document, franchisees and their owners are restricted from having direct or indirect ownership in any competing business. Specifically, the franchise agreement stipulates that franchisees and their owners must not violate any agreement, including non-competition covenants, and they must not be direct or indirect owners of any competitor. This restriction is in place to protect Crave Cookies's market position and prevent conflicts of interest.
This requirement is part of the broader agreement that franchisees must sign, which includes representing that they are not violating any existing agreements by becoming a Crave Cookies franchisee. This representation is crucial, as it ensures that new franchisees are fully committed to the Crave Cookies system and brand, without divided loyalties or potential conflicts arising from involvement with other competing businesses.
Furthermore, during the term of the agreement, Crave Cookies prohibits franchisees, their owners, and their spouses from having any ownership interest in, lending money to, providing services to, or being employed by any competitor. After the agreement expires or is terminated, this restriction continues for two years within a five-mile radius of the franchisee's territory or any other Crave Cookies business. This post-term covenant ensures continued protection for Crave Cookies against competition from former franchisees who might leverage their knowledge of the Crave Cookies system.