What happens if a Crepe De Licious franchisee is in default under the Franchise Agreement?
Crepe_De_Licious Franchise · 2025 FDDAnswer from 2025 FDD Document
If you do not comply with a deadline under the Development Schedule (a "Missed Deadline"), you will be in default under the Area Development Agreement. For one Missed Deadline, we will provide you with an opportunity to cure your default and we will determine and notify you of a new deadline for that one Missed Deadline (without changing the remainder of the Development Schedule). If you fail to come into compliance by that new deadline, and/or upon the occurrence of a second Missed Deadline, we may terminate your Area Development Agreement, or we may elect to take one or more of the following actions: (a) eliminate the limited exclusivity or reduce the scope of protections granted to you within the Development Area; (b) reduce the scope of the Development Area; (c) reduce the number of Franchised Restaurants for you to develop, or (d) retain all Area Development Fees paid to us. If we elect to take one or more of these actions, we will provide written notice of such action, and the Area Development Agreement will be amended to reflect the changes.
Source: Item 12 — TERRITORY (FDD pages 40–43)
What This Means (2025 FDD)
According to the 2025 Crepe De Licious Franchise Disclosure Document, if a franchisee fails to meet deadlines outlined in the Development Schedule under the Area Development Agreement, it constitutes a default. For the first missed deadline, Crepe De Licious will provide an opportunity for the franchisee to correct the issue and will set a new deadline. However, this extension does not alter the remaining deadlines in the Development Schedule.
If the franchisee fails to meet the new deadline for the initial missed deadline, or if a second deadline is missed, Crepe De Licious has the right to terminate the Area Development Agreement. Alternatively, Crepe De Licious may choose to take other actions such as eliminating or reducing the exclusivity within the Development Area, reducing the scope of the Development Area, decreasing the number of Franchised Restaurants the franchisee is allowed to develop, or retaining all Area Development Fees already paid.
If Crepe De Licious decides to take any of these actions, it will provide written notice to the franchisee, and the Area Development Agreement will be amended to reflect the changes. This means that franchisees need to be diligent in meeting the agreed-upon Development Schedule to avoid potential penalties or loss of rights under the Area Development Agreement.