Does Crepe De Licious have the right to engage in a private placement of securities?
Crepe_De_Licious Franchise · 2025 FDDAnswer from 2025 FDD Document
You expressly affirm and agree that we may sell our assets, our rights to the Marks or to the System outright to a third party; may go public; may engage in a private placement of some or all of our securities; may merge, acquire other corporations, or be acquired by another corporation; may undertake a refinancing, recapitalization, leveraged buyout or other economic or financial restructuring; and, with regard to any or all of the above sales, assignments and dispositions, you expressly and specifically waive any claims, demands or damages arising from or related to the loss of said Marks (or any variation thereof) and/or the loss of association with or identification of "Crepe Delicious Holding USA, Inc." as the franchisor. Nothing contained in this Agreement shall require us to remain in the restaurant business or to offer the same products and services, whether or not bearing the Marks, in the event that we exercise our right to assign our rights in this Agreement.
Source: Item 22 — CONTRACTS (FDD page 57)
What This Means (2025 FDD)
According to the 2025 Crepe De Licious Franchise Disclosure Document, Crepe De Licious retains the right to engage in a private placement of its securities. This means that Crepe De Licious can sell its stocks or bonds to private investors without needing to register them with the Securities and Exchange Commission (SEC).
This right also includes the ability of Crepe De Licious to sell its assets, rights to its trademarks, or the entire franchise system to a third party. They can also go public, merge with or acquire other corporations, or be acquired by another corporation. Additionally, Crepe De Licious can undertake refinancing, recapitalization, leveraged buyouts, or other economic or financial restructuring.
For a prospective franchisee, this clause indicates that the ownership and structure of Crepe De Licious could change during the term of their franchise agreement. While Crepe De Licious retains these rights, the franchisee expressly waives any claims, demands, or damages arising from the loss of association with "Crepe Delicious Holding USA, Inc." as the franchisor due to these actions. This waiver is a significant point for potential franchisees to consider, as it limits their recourse if such changes occur.
It's important for franchisees to understand that Crepe De Licious is not obligated to remain in the restaurant business or offer the same products and services if they exercise their right to assign their rights in the agreement. This provides Crepe De Licious with considerable flexibility in its business operations and future direction, which may or may not align with the franchisees' long-term interests.