What documents must the franchisee (and its owners) and the transferee (and its owners) sign in connection with a transfer of a Cream franchise?

According to Cream's 2025 Franchise Disclosure Document, both the franchisee (and their owners) and the transferee (and their owners) must sign all documents that Cream requires for a transfer. These documents must be in a form satisfactory to Cream. Specifically, these documents include: a release of any and all claims (except for claims which cannot be released or waived pursuant to applicable law) against Cream and its affiliates, as well as their owners, officers, directors, employees, and agents. Additionally, they must sign covenants agreeing to satisfy all post-termination obligations under the Franchise Agreement.

This requirement ensures that Cream can comprehensively manage franchise transfers and protect its interests. The release of claims protects Cream from potential legal issues arising from the previous franchisee's operation, while the post-termination obligations ensure that the outgoing franchisee remains responsible for any duties that extend beyond the transfer date.

For a prospective Cream franchisee, this means that transferring their franchise involves a significant legal process. They should be prepared to work closely with Cream to ensure all required documents are correctly executed. It is advisable to seek legal counsel to fully understand the implications of these documents, especially the release of claims and post-termination obligations. This is a fairly standard practice in franchising, as franchisors typically want to ensure a clean break and continued compliance with the franchise agreement.

Furthermore, if the transfer involves any beneficial or ownership interest, the transferees must sign Cream's current form of guaranty, undertaking to be bound by all provisions of the Franchise Agreement and any ancillary agreements. They must also provide an updated Attachment A. If the transfer is of the Franchise Agreement or Development Rights, the transferee must sign Cream's then-current form of area development agreement and related documents, which may differ materially from the original agreement. If the transfer is of the Franchise Agreement or the Shop, the transferee must sign Cream's then-current form of franchise agreement and related documents, which may also differ materially from the original agreement.