What constitutes substantial compliance with the Cream franchise agreement during the term, as it relates to renewal?
Cream Franchise · 2025 FDDAnswer from 2025 FDD Document
When this Agreement expires, you may renew your franchise to operate your Shop for two successive terms of 5 years each, if you meet the following conditions:
- (1) you give us written notice of your election to acquire a successor franchise no more than 270 days and no less than 180 days before this Agreement expires;
- (2) you and each of your owners have substantially complied with this Agreement at all times during the Term;
- (3) you maintain possession of the Premises pursuant to a Lease we have approved, which must have a Lease term no less than the full term of the renewal franchise;
- (4) you agree to remodel and/or expand your Shop, add or replace improvements, and otherwise modify your Shop as we require to comply with System Standards thenapplicable for new Jeni's Ice Creams Scoop Shops;
- (5) you pay us our renewal fee, which is 50% of the then-current initial franchise fee;
- (6) you and your owners have not violated any provision of this Agreement or any other agreement with us or our affiliates during both the 60-day period before you give us written notice of your election to acquire a successor franchise and on the date on which the term of the successor franchise commences, in full compliance with this Agreement including that you have paid all Royalties, Brand Fund Contributions, and other amounts owed to us, our affiliates, and third-party suppliers, and have submitted all required reports and statements;
- (7) you and your owners sign the franchise agreement and all other ancillary documents and guaranties we then use to grant franchises for Jeni's Ice Creams Scoop Shops (modified as necessary to reflect the fact that it is for a renewal franchise), which may contain provisions that differ materially from those contained in this Agreement, including changes to your Royalty, Brand Fund Contribution, and Protected Territory;
- (8) you and your owners agree to sign, in a form satisfactory to us, a general release of any and all claims (except for claims which cannot be released or waived pursuant to an applicable franchise statute) against us and our owners, affiliates, officers, directors, employees, agents, successors, and assigns; and
(9) we are then-offering franchises for Jeni's Ice Creams Scoop Shops in your geographic market.
Source: Item 23 — RECEIPTS (FDD pages 61–192)
What This Means (2025 FDD)
According to the 2025 FDD, substantial compliance with the Cream franchise agreement is a condition for renewal. To renew a Cream franchise for two successive terms of 5 years each, the franchisee and their owners must have substantially complied with the agreement at all times during the initial term.
In addition to substantial compliance, the franchisee must meet several other conditions to be eligible for renewal. These include providing written notice of intent to renew within a specific timeframe (no more than 270 days and no less than 180 days before the agreement expires), maintaining possession of the premises under an approved lease, agreeing to remodel or modify the shop to meet current system standards, and paying a renewal fee equal to 50% of the then-current initial franchise fee.
Furthermore, the franchisee and their owners must not have violated any agreement with Cream or its affiliates within 60 days before the renewal notice and on the date the renewal term begins. This includes paying all royalties, brand fund contributions, and other amounts owed, as well as submitting all required reports and statements. They must also sign the then-current franchise agreement and related documents, which may contain materially different terms, and agree to a general release of claims against Cream. Finally, Cream must be offering franchises in the franchisee's geographic market at the time of renewal.