What is Crave Cookies Franchising's recourse if they have the right to terminate any franchise agreement with the franchisee?
Crave_Cookies Franchise · 2025 FDDAnswer from 2025 FDD Document
suant to a separate franchise agreement executed pursuant to this MUDA for each such Crave Cookies business.
- 3. Development Area. Franchisee shall locate the first location in the Development Area indicated on the Summary Page of this Franchise Agreement. Subsequent areas may be opened in any order so long as each Opening Deadline is met in order. Franchisee acknowledges that it does not have exclusive rights to develop, open or operate Crave Cookies businesses in the Development Area.
- 4. Default and Termination. The MUDA is automatically terminated without opportunity for Franchisee to cure, if any of the following occur:
- (i) Franchisee fails to satisfy the development schedule;
Source: Item 23 — RECEIPTS (FDD pages 47–194)
What This Means (2025 FDD)
According to Crave Cookies' 2025 Franchise Disclosure Document, if Crave Cookies Franchising has grounds to terminate a franchise agreement with a franchisee, this also triggers the automatic termination of the Multi-Unit Development Agreement (MUDA) without an opportunity for the franchisee to remedy the situation. This means that the franchisee loses the right to develop any further Crave Cookies locations outlined in the MUDA.
Additionally, the FDD outlines a detailed escalation of penalties for various infractions, ranging from mild to severe. For instance, a third severe infraction could result in a $5,000 fine and consideration for termination of the franchise agreement. This structured approach to addressing violations suggests that termination is viewed as a last resort, following a series of warnings, fines, and mandatory improvement plans.
Furthermore, the FDD includes a Franchisor Rider that addresses the lease agreement between the franchisee (as tenant) and the landlord. If the Franchise Agreement is terminated, Crave Cookies has the option to request the franchisee to assign the lease to them. This ensures that Crave Cookies can maintain control over the location, potentially re-franchising it or operating it themselves. The landlord agrees to this arrangement, highlighting the franchisor's interest in securing the location even after a franchise termination.