What duty is a Cream franchisee bound by within any provision of the franchise agreement?
Cream Franchise · 2025 FDDAnswer from 2025 FDD Document
Subject to the terms of this Agreement, we hereby grant you a franchise to develop, own, and operate a Jeni's Ice Creams Scoop Shop (your "Shop") on the terms described in this Agreement for a term that will begin on the Effective Date and will expire 10 years from your Effective Date unless sooner terminated under Section 14 (the "Term"). You agree to faithfully, honestly, and diligently perform your obligations under this Agreement and to use your best efforts to promote and operate your Shop from and after the Opening Date on a continuous basis for the entirety of the Term.
Source: Item 23 — RECEIPTS (FDD pages 61–192)
What This Means (2025 FDD)
According to the 2025 FDD, a Cream franchisee is obligated to faithfully, honestly, and diligently perform their obligations under the Franchise Agreement. This includes using their best efforts to promote and operate their Cream shop continuously from the opening date for the entire term of the agreement. The franchise agreement term begins on the effective date and extends for 10 years, unless terminated earlier as per Section 14 of the agreement.
This obligation extends not only to the franchisee but also to any individuals who guarantee the franchisee's performance. If the franchisee is a corporation, LLC, or partnership, they must maintain their legal standing and organizational documents, reflecting any restrictions on ownership transfers. Furthermore, owners with a 10% or greater interest in the franchisee's entity must personally guarantee the franchisee's obligations under the agreement.
This requirement ensures that Cream franchisees are committed to upholding the brand's standards and operational requirements throughout the duration of the franchise agreement. It also provides Cream with recourse against both the franchisee and their guarantors in case of any breaches or failures to meet the obligations outlined in the agreement. Prospective franchisees should carefully review all terms and conditions to fully understand their duties and responsibilities.