If the Crave Cookies franchisee is a partnership, what information about the owners must be provided?
Crave_Cookies Franchise · 2025 FDDAnswer from 2025 FDD Document
(v) all owners of the proposed assignee provide a guaranty in accordance with Section 2.5;
(vi) Franchisee has paid all monetary obligations to Crave Cookies Franchising and its affiliates, and to any lessor, vendor, supplier, or lender to the Business, and Franchisee is not otherwise in default or breach of this Agreement or of any other obligation owed to Crave Cookies Franchising or its affiliates;
(vii) the proposed assignee and its owners and employees undergo such training as Crave Cookies Franchising may require;
(viii) Franchisee, its Owners, and the transferee and its owners execute a general release of Crave Cookies Franchising in a form satisfactory to Crave Cookies Franchising; and
(ix) the Business fully complies with all of Crave Cookies Franchising's most recent System Standards.
15.3 Transfer for Convenience of Ownership. If Franchisee is an individual, Franchisee may Transfer this Agreement to a corporation or limited liability company formed for the convenience of ownership after at least 15 days' notice to Crave Cookies Franchising, if, prior to the Transfer: (1) the transferee provides the information required by Section 2.3; (2) Franchisee provides copies of the entity's charter documents, by-laws (or operating agreement) and similar documents, if requested by Crave Cookies Franchising, (3) Franchisee owns all voting securities of the corporation or limited liability company, and (4) Franchisee provides a guaranty in accordance with Section 2.5.
Source: Item 22 — CONTRACTS (FDD page 47)
What This Means (2025 FDD)
Based on the 2025 Crave Cookies Franchise Disclosure Document, if a franchisee is an individual and wants to transfer the agreement to a corporation or LLC for ownership convenience, all owners of the proposed assignee must provide a guaranty as per Section 2.5 of the agreement.
Additionally, the franchisee must provide the information required by Section 2.3, which likely pertains to details about the transferee entity. Copies of the entity's charter documents, by-laws (or operating agreement), and similar documents must also be provided if requested by Crave Cookies. The franchisee must own all voting securities of the corporation or LLC.
These requirements ensure that Crave Cookies maintains control over who operates its franchises and that all parties involved are committed to upholding the franchise agreement. This is a fairly standard practice in franchising, as franchisors need to vet and approve new ownership to protect their brand and system standards.