What must the Cream franchisee do if the identity of the Principal Owner changes?
Cream Franchise · 2025 FDDAnswer from 2025 FDD Document
obligations under Section 12, you and your owners agree to sign and deliver to us revised Attachment A to reflect any permitted changes in the information that Attachment A now contains.
You must identify on Attachment A 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 A 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. Any decision made by the Principal Owner will be final and binding upon you, and we will be entitled to rely solely upon the decision of the Principal Owner in any such dealings without the necessity of any discussions with any other person, and we will not be held liable for any actions taken by you or otherwise, based upon any decision or actions of the Principal Owner. You represent and agree that the person acting as your Principal Owner has full power and authority to enter into this Agreement and any other documents to which you are a party, and to make binding decisions on your behalf.
D. PREMISES OF YOUR SHOP.
Other than off-Premises services we have approved (as described in Section 8.C), you may operate your Shop only at the specific location identified on Attachment C (the "Premises"). If the Premises have not been approved when you sign this Agreement, you must select a site in the Site Selection Area (as described in Section 2.A below). You agree to use the Premises only for your Shop and no other activities or business of any kind without our express approval. You agree not to conduct the business of your Shop at any location other than the Premises.
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 franchisee must take specific actions. The franchisee is required to obtain Cream's written consent before making any changes to the Principal Owner. Following this, the franchisee must deliver a revised Attachment A to Cream. This revised attachment should accurately identify the new Principal Owner. This requirement applies if the identity of the Principal Owner changes during the term of the franchise agreement.
The Principal Owner holds significant authority, acting on behalf of the franchisee in all dealings 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 involved with the franchise. This underscores the importance of Cream's approval for any changes to this role, as it directly impacts the communication and decision-making process between the franchisee and Cream.
Attachment A to the Franchise Agreement must completely and accurately describe all of the franchisee's owners and their interests in the entity as of the effective date of the agreement. Each owner with a 10% or greater ownership interest in the Cream franchise must execute a guarantee, binding them to the provisions of the agreement. The franchisee and owners must sign and deliver a revised Attachment A to reflect any permitted changes in the information that Attachment A contains.