What must the Cream franchisee Entity deliver to Cream if the identity of the Principal Owner changes?
Cream Franchise · 2025 FDDAnswer from 2025 FDD Document
ed. You agree to remain validly existing and in good standing under the laws of the state of your formation throughout the Term. You agree to maintain organizational documents, including your operating agreement or partnership agreement, as applicable, that reflect the restrictions on issuance and transfer of any ownership interests in you described in this Agreement, and all certificates and other documents representing ownership interests in you will bear a legend referring to this Agreement's restrictions.
You agree and represent that Attachment C to this Agreement completely and accurately describes all of your owners and their interests in you as of the Effective Date. Each of your owners with a 10% or greater ownership interest in your Entity must execute a guarantee in the form we prescribe undertaking personally to be bound, jointly and severally, by all provisions of this Agreement
and any ancillary agreements between you and us. Our current form of guarantee is attached herein as Attachment D. Subject to our rights and your obligations under Section 7, you and your owners agree to sign and deliver to us revised Attachment C to reflect any permitted changes in the information that Attachment C now contains.
You must identify on Attachment C one of your owners who is a natural person and who will have authority and signatory power on behalf of you (the "Principal Owner"). You must obtain our written consent prior to changing the Principal Owner and agree to deliver to us a revised Attachment C to accurately identify the Principal Owner should the identity of that person change during the Term as permitted hereunder. You agree that the Principal Owner is authorized, on your behalf, to deal with us in respect of all matters whatsoever which may arise in respect of this Agreement.
Source: Item 23 — RECEIPTS (FDD pages 61–192)
What This Means (2025 FDD)
According to Cream's 2025 Franchise Disclosure Document, if the identity of the Principal Owner changes, the Cream franchisee must deliver a revised Attachment C to accurately identify the new Principal Owner. Prior to this change, the franchisee must obtain Cream's written consent. Attachment C to the Franchise Agreement completely and accurately describes all of the franchisee's owners and their interests as of the effective date of the agreement.
The Principal Owner is a natural person who has authority and signatory power on behalf of the franchisee. This individual is authorized to handle all matters related to the Franchise Agreement with Cream. Any decision made by the Principal Owner is considered final and binding, and Cream is entitled to rely solely on these decisions without needing to consult with any other person. Cream will not be held liable for actions taken based on the Principal Owner's decisions.
This requirement ensures that Cream always knows who is authorized to act on behalf of the franchisee. It also allows Cream to maintain clear communication and decision-making channels. The franchisee must ensure that any changes to the Principal Owner are properly documented and approved by Cream to avoid any potential disputes or misunderstandings.