factual

What obligations survive the termination or expiration of the Crave Cookies franchise agreement?

Crave_Cookies Franchise · 2025 FDD

Answer from 2025 FDD Document

likely to materially and unfavorably affect the Crave Cookies brand;

  • (xiv) Franchisee fails to meet the health inspection standards described in Section 7.3(e) two or more times in any 36-month period; or
  • (xv) Franchisee fails to achieve a passing score on an inspection conducted by Crave Cookies Franchising, LLC two or more times in any 36-month period.
  • 14.3 Effect of Termination. Upon termination or expiration of this Agreement, all obligations that by their terms or by reasonable implication survive termination, including those pertaining to non-competition, confidentiality, indemnity, and dispute resolution, will remain in effect, and Franchisee must immediately:
    • (i) pay all amounts owed to Crave Cookies Franchising based on the operation of the Business through the effective date of termination or expiration;
    • (ii) return to Crave Cookies Franchising all copies of the Manual, Confidential Information and any and all other materials provided by Crave Cookies Franchising to Franchisee or created by a third party for Franchisee relating to the operation of the Business, and all items containing any Marks, copyrights, and other proprietary items; and delete all Confidential Information and proprietary materials from electronic devices;
    • (iii) notify the telephone, internet, email, electronic network, directory, and listing entities of the termination or expiration of Franchisee's right to use any numbers, addresses, domain names, locators, directories and listings associated with any of the Marks, and authorize their transfer to Crave Cookies Franchising or any new franchisee as may be directed by Crave Cookies Franchising, and Franchisee hereby irrevocably appoints Crave Cookies Franchising, with full power of substitution, as its true and lawful attorney-in-fact, which appointment is coupled with an interest; to execute such directions and authorizations as may be necessary or appropriate to accomplish the foregoing; and
    • (iv) cease doing business under any of the Marks.
  • 14.4 Remove Identification. Within 30 days after termination or expiration, Franchisee shall at its own expense "de-identify" the Location so that it no longer contains the Marks, signage, or any trade dress of a Crave Cookies business, to the reasonable satisfaction of Crave Cookies Franchising. Franchisee shall comply with any reasonable instructions and procedures of Crave

Cookies Franchising for de-identification. If Franchisee fails to do so within 30 days after this Agreement expires or is terminated, Crave Cookies Franchising may enter the Location to remove the Marks and de-identify the Location. In this event, Crave Cookies Franchising will not be charged with trespass nor be accountable or required to pay for any assets removed or altered, or for any damage caused by Crave Cookies Franchising.

14.5 Liquidated Damages. If Crave Cookies Franchising terminates this Agreement based upon Franchisee's default (or if Franchisee purports to terminate this Agreement except as permitted under Section 14.1), then within 10 days thereafter Franchisee shall pay to Crave Cookies Franchising a lump sum (as liquidated damages and not as a penalty) calculated as follows: (x) the average Royalty Fees and Marketing Fund Contributions that Franchisee owed to Crave Cookies Franchising under this Agreement for the 52-week period preceding the date on which Franchisee ceased operating the Business; multiplied by (y) the lesser of (1) 104 or (2) the number of weeks remaining in the then-current term of this Agreement. If Franchisee had not operated the Business for at least 52 weeks, then (x) will equal the average Royalty Fees and Marketing Fund Contributions that Franchisee owed to Crave Cookies Franchising during the period that Franchisee operated the Business.

Source: Item 22 — CONTRACTS (FDD page 47)

What This Means (2025 FDD)

According to Crave Cookies' 2025 Franchise Disclosure Document, several obligations remain in effect even after the franchise agreement terminates or expires. These include obligations related to non-competition, confidentiality, indemnity, and dispute resolution, which continue as specified in the agreement.

Specifically, upon termination or expiration, the franchisee must immediately pay all outstanding amounts owed to Crave Cookies based on the business's operation up to the termination date. The franchisee is also required to return all copies of the operations manual, confidential information, and any other materials provided by Crave Cookies, including items containing trademarks, copyrights, and proprietary information. Additionally, all confidential and proprietary materials must be deleted from electronic devices.

The franchisee must also notify all relevant entities (telephone, internet, email, etc.) about the termination of their right to use any numbers, addresses, domain names, or listings associated with Crave Cookies' trademarks, and authorize the transfer of these to Crave Cookies or a new franchisee. The franchisee must cease operating under any of Crave Cookies' trademarks. Within 30 days of termination or expiration, the franchisee is responsible for de-identifying the location, removing all Crave Cookies' marks, signage, and trade dress to Crave Cookies' satisfaction. If the franchisee fails to do so, Crave Cookies has the right to enter the location and remove the branding themselves, without being liable for trespass or damages.

Furthermore, Crave Cookies retains the option to purchase the assets of the business or require the franchisee to assign the lease after termination or expiration. To exercise this option, Crave Cookies must notify the franchisee within 30 days of termination or expiration. The purchase price will be the lower of the book value or fair market value of the assets, excluding any value associated with trademarks or intangible assets. These post-termination obligations are typical in franchise agreements to protect the brand and ensure a smooth transition.

Disclaimer: This information is extracted from the 2025 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.