Does the Cream franchise agreement's indemnification clause continue after the agreement expires or terminates?

According to the 2025 Cream FDD, the obligations related to indemnification survive the termination or expiration of the franchise agreement. Specifically, all obligations of Cream and the franchisee (including the franchisee's owners) that either expressly state they survive, or by their nature would survive, the agreement's expiration or termination will continue after the agreement ends. These obligations remain in effect until they are fully satisfied or naturally expire.

This continuation includes obligations related to several key areas, such as non-disparagement, non-competition, non-interference, confidentiality, information security, innovations, and, importantly, indemnification. This means that even after the franchise agreement concludes, the franchisee may still be responsible for covering losses, damages, or liabilities that Cream incurs due to the franchisee's actions or inactions during the term of the agreement.

For a prospective Cream franchisee, this has significant implications. It's not enough to simply fulfill the terms of the franchise agreement during its active period; the franchisee must also understand that certain responsibilities extend beyond the agreement's end date. This could involve maintaining confidentiality, avoiding competitive activities, or being prepared to indemnify Cream for covered claims even after the franchise has closed. Franchisees should carefully review the specific indemnification clauses and other continuing obligations to fully grasp their long-term responsibilities.

This type of clause is relatively standard in franchising, as franchisors seek to protect their brand and system standards even after a franchisee exits the system. However, the scope and specific terms of these continuing obligations can vary, so it is important for a prospective franchisee to fully understand these terms.