What is the 'Effective Date' referring to in the context of the Cream Brand Fund Contribution?
Cream Franchise · 2025 FDDAnswer from 2025 FDD Document
ays before your expected Opening Date, and to complete all grand opening marketing pursuant to the plan we have approved. You must also use any media, materials, programs, and strategies that we require in connection with the grand opening advertising program.
B. BRAND FUND.
We have established a brand promotion fund (the "Brand Fund") to administer certain advertising, marketing, and public relations programs for the System, the Jeni's® brand, and the promotion of Jeni's Ice Creams Scoop Shops. You hereby agree to contribute to the Brand Fund the amount that we prescribe (the "Brand Fund Contribution"). As of the Effective Date, the amount of the Brand Fund Contribution is 2% of your Net Sales. We may modify the amount of the Brand Fund Contribution from time to time with 30 days prior notice to you, provided that the total amount of the Brand Fund Contribution will not at any time exceed 4% of your Net Sales. The Brand Fund Contribution must be paid by you in the manner we designate from time to time, which may include collecting amounts in the same manner as the Royalty.
Source: Item 23 — RECEIPTS (FDD pages 61–192)
What This Means (2025 FDD)
According to Cream's 2025 Franchise Disclosure Document, the 'Effective Date' refers to the date on which the franchise agreement becomes effective. The document states that the parties involved execute and deliver the agreement on specific dates, but the agreement is designed to be effective as of the 'Effective Date'.
In the context of the Brand Fund Contribution, the 'Effective Date' is the starting point for when the franchisee's obligation to contribute to the Brand Fund begins. As of this date, the contribution is set at 2% of Net Sales. This means that from the moment the franchise agreement becomes effective, the franchisee is required to pay this percentage of their sales into the Brand Fund.
Cream retains the right to modify the Brand Fund Contribution amount, but must provide 30 days' notice. The total contribution will not exceed 4% of Net Sales. The Brand Fund Contribution must be paid in a manner designated by Cream, which may include collecting amounts in the same manner as the Royalty fees.