Does Crave Cookies Franchising's action to discontinue supplies constitute a breach of the agreement?
Crave_Cookies Franchise · 2025 FDDAnswer from 2025 FDD Document
- 11.4 Right to Discontinue Supplies Upon Default. While Franchisee is in default or breach of this Agreement, Crave Cookies Franchising may (i) require that Franchisee pay cash on delivery for products or services supplied by Crave Cookies Franchising, (ii) stop selling or providing any products and services to Franchisee, and/or (iii) request any third-party vendors to not sell or provide products or services to Franchisee.
No such action by Crave Cookies Franchising shall be a breach or constructive termination of this Agreement, change in competitive circumstances or similarly characterized, and Franchisee shall not be relieved of any obligations under this Agreement because of any such action.
Such rights of Crave Cookies Franchising are in addition to any other right or remedy available to Crave Cookies Franchising.
Source: Item 22 — CONTRACTS (FDD page 47)
What This Means (2025 FDD)
According to Crave Cookies' 2025 Franchise Disclosure Document, under Section 11.4, Crave Cookies Franchising has the right to discontinue supplies to a franchisee who is in default or breach of the Franchise Agreement. This action by Crave Cookies Franchising will not be considered a breach or constructive termination of the agreement.
Specifically, while a franchisee is in default or breach, Crave Cookies Franchising can (i) require cash on delivery for products or services, (ii) stop selling or providing any products and services, and/or (iii) request third-party vendors to not sell or provide products or services to the franchisee. The FDD explicitly states that these actions do not constitute a breach of the agreement by Crave Cookies Franchising.
This clause protects Crave Cookies Franchising, allowing them to manage risk and ensure franchisees meet their obligations. It also means that a franchisee in default cannot claim that the discontinuation of supplies is a breach that relieves them of their obligations under the agreement. This is a fairly standard provision in franchise agreements, designed to protect the franchisor's interests when a franchisee is not meeting their contractual obligations.