What assurances must Crepe De Licious provide when assigning its agreement to another entity?
Crepe_De_Licious Franchise · 2025 FDDAnswer from 2025 FDD Document
first obtained will be null and void, and shall be a material default of this Agreement. In that event: we may terminate this Agreement under Section 16.01; you will remain responsible for performing the post-termination obligations in Section 17; and the purported transferee may not operate the Franchised Business under the Marks or the System.
15.03 Transfer Conditions. We may, to the extent permitted by applicable law, condition and withhold our consent to a Transfer, when required under Section 15.02 until the transferee and you meet certain conditions. If a Transfer is to occur: (a) the proposed transferee must apply for a Crepe de licious franchise and must meet all of our then-current standards and requirements for becoming a Crepe de licious franchisee, in our sole discretion; (b) you or the proposed transferee must provide to us in writing the circumstances of the proposed Transfer; (c) the proposed transferee must provide to us the same supporting documents as a new franchise applicant; (d) you or the proposed transferee must pay us a transfer fee of $10,000 ($5,000 if the proposed transferee is an existing Crepe de licious franchisee), including a non-refundable $1,000 deposit that is due upon the request for approval of a Transfer (e) the proposed transferee must sign the form of franchise agreement and related documents we then offer to prospective franchisees, which agreement will provide for a new initial term of five (5) years, and the transferee's owners will sign the form of owners agreement or guaranty we then require of franchisees' owners; (f) the proposed transferee and its designated manager must complete to our satisfaction the initial training then required for new franchisees and their designated managers; (g) you or the proposed transferee must refurbish the Restaurant, Kiosk, or Food Truck to conform to our then-current standards and specifications; (h) we must receive general releases from you and each of your owners, and payment of all amounts then owed to us and our affiliates by you and your owners and affiliates, and the transferee and its owners and affiliates, under this Agreement or otherwise; (i) you must not be in default under this Agreement or any other agreement with us or any of our affiliates; (j) you must give us at least 30 days' prior written notice of any proposed Transfer; (k) you must reimburse us upon receipt of our invoice for any broker or other placement fees we incur as a result of the transfer; (l) the Restaurant, Kiosk, or Food Truck must be in operation for at least one (1) year, if we have not exercised right of first refusal; (m) the proposed transferee must have sufficient business experience and financial resources to operate the Franchise; (n) your landlord must consent to transfer the lease to the proposed transferee; (o) you must sign a non-compete agreement not to engage in a competitive business for two (2) years within: (i) a 25 mile
Source: Item 22 — CONTRACTS (FDD page 57)
What This Means (2025 FDD)
The 2025 Crepe De Licious Franchise Disclosure Document outlines specific conditions that must be met for a transfer of the franchise agreement to be approved. Crepe De Licious may withhold consent for a transfer until both the current franchisee and the proposed transferee satisfy these conditions.
To begin, the potential new franchisee must formally apply for a Crepe De Licious franchise and meet all of the brand's current standards and requirements for new franchisees. The current or prospective franchisee needs to provide written details about the circumstances surrounding the proposed transfer and the same supporting documents typically required from a new franchise applicant. A transfer fee of $10,000 is required, although this is reduced to $5,000 if the transferee is already a Crepe De Licious franchisee. A non-refundable deposit of $1,000 is due when requesting transfer approval.
The proposed transferee must also sign the current form of the franchise agreement, which includes a new initial term of five years, and their owners must sign the standard owners' agreement or guaranty. Both the transferee and their designated manager need to complete the initial training program to Crepe De Licious's satisfaction. The restaurant, kiosk, or food truck location must be refurbished to meet the brand's current standards. Crepe De Licious requires general releases from the current franchisee and their owners, along with payment of all outstanding amounts owed to Crepe De Licious and its affiliates by both parties. The current franchisee must not be in default of any agreements with Crepe De Licious or its affiliates and must provide at least 30 days' written notice of the proposed transfer.
Additional stipulations include reimbursing Crepe De Licious for any broker or placement fees incurred due to the transfer. If Crepe De Licious hasn't exercised its right of first refusal, the location must have been in operation for at least one year. The proposed transferee must demonstrate sufficient business experience and financial resources to successfully operate the franchise, and the landlord must consent to the lease transfer. The current franchisee is required to sign a non-compete agreement, preventing them from engaging in a competitive business within a 25-mile radius of both their former location and any other Crepe De Licious businesses for two years. Finally, both parties must provide any additional information reasonably requested by Crepe De Licious.