Besides not competing directly, what other actions must a Cream franchisee take to comply with the covenant not to compete?
Cream Franchise · 2025 FDDAnswer from 2025 FDD Document
- (3) cease to directly or indirectly identify yourself or your business as a current or former Jeni's Ice Creams Scoop Shop or as one of our current or former franchise owners (except in connection with other Jeni's Ice Creams Scoop Shops you operate in compliance with the terms of a valid Franchise Agreement with us) and take the action required to cancel or assign all fictitious or assumed name or equivalent registrations relating to your use of any Mark;
- (4) if we do not exercise our option to purchase your Shop under Section 15.D below, promptly and at your own expense, make the alterations we specify to distinguish your Shop clearly from its former appearance and from other Jeni's Ice Creams Scoop Shops, including by removing all materials and signage bearing our Marks and removing from both the interior and exterior of the Premises all materials and components of our trade dress as we determine to be necessary in order to prevent public confusion and in order to comply with the non-competition provisions set forth in Section 15.C;
- (5) cease using and, at our direction, either disable or transfer, assign, or otherwise convey to us full control of all Contact Information and Digital Presences that you used to operate your Shop or that displays any of the Marks or any reference to the franchise system (provided that all liabilities and obligations arising from any such Contact Information or Digital Presence prior to the date of the transfer, assignment, or conveyance to us will remain your sole responsibility in all respects, and any costs we incur in connection therewith will be indemnifiable under Section 16.D);
- (6) return to us or destroy (as we require) all items, forms, and materials containing any Mark or otherwise identifying or relating to Jeni's Ice Creams Scoop Shops, and any and all Confidential Information (including the Brand Manual and any and all customer data or other information from your Computer System);
- (7) comply with all other System Standards we establish from time to time (and all applicable laws) in connection with the closure and de-identification of your Shop, including as it relates to disposing of Personal Information, in any form, in your possession or the possession of any of your employees; and
- (8) give us evidence satisfactory to us of your compliance with these obligations.
Source: Item 23 — RECEIPTS (FDD pages 61–192)
What This Means (2025 FDD)
According to Cream's 2025 Franchise Disclosure Document, franchisees have several obligations related to non-competition upon termination or expiration of the franchise agreement. These include ceasing to identify themselves as a current or former Cream franchisee, except when operating other Cream locations under a valid franchise agreement. Franchisees must also take actions to cancel or assign any registrations related to the use of Cream's marks.
Furthermore, franchisees are required to alter their former Cream shop to clearly distinguish it from its previous appearance and from other Cream locations. This involves removing all materials and signage bearing Cream's marks and removing all interior and exterior elements of Cream's trade dress to prevent public confusion and comply with non-competition provisions. Franchisees must also cease using and either disable or transfer to Cream all contact information and digital presences used to operate the shop, ensuring Cream has full control over these assets.
Additionally, franchisees must return or destroy all items, forms, and materials containing any Cream mark or relating to Cream shops, including confidential information like the Brand Manual and customer data. Compliance with all other System Standards related to the closure and de-identification of the shop, including the disposal of personal information, is also required. Finally, franchisees must provide Cream with satisfactory evidence of their compliance with all these obligations.
These measures ensure that upon termination or expiration of the franchise agreement, the former franchisee takes comprehensive steps to disassociate from the Cream brand, thereby protecting Cream's brand identity and preventing unfair competition. Prospective franchisees should carefully review these obligations to understand the full scope of their responsibilities when exiting the Cream franchise system.