Does the Cream Guaranty require the Guarantor to refrain from engaging in specific activities?
Cream Franchise · 2025 FDDAnswer from 2025 FDD Document
terminated and we are transitioning your Shop | | | operations as permitted under Section 15D or determining whether to do so | |
ATTACHMENT C TO FRANCHISE AGREEMENT
PREMISES AND PROTECTED TERRITORY
| sell any products and services of any kind and in any manner from | your | Shop and/or using the | |
|---|---|---|---|
| Marks, unless we direct you otherwise in connection with our exercise of our option to purchase |
ATTACHMENT D TO FRANCHISE AGREEMENT
GUARANTY AND ASSUMPTION OF OBLIGATIONS
THIS GUARANTY AND ASSUMPTION OF OBLIGATIONS is given by each of the undersigned persons indicated below who have executed this Guaranty (each a "Guarantor") to be effective as of the Effective Date of the Agreement (defined below).
In consideration of, and as an inducement to, the execution of that certain Franchise Agreement (the "Agreement") on this date by Jeni's Splendid Ice Creams Franchise, LLC ("us," "we," or "our"), each Guarantor personally and unconditionally (a) guarantees to us and our successors and assigns, for the term of the Agreement and afterward as provided in the Agreement, that ________________________________________ ("Franchise Owner") will punctually pay and perform each and every undertaking, agreement, and covenant set forth in the Agreem
Source: Item 23 — RECEIPTS (FDD pages 61–192)
What This Means (2025 FDD)
According to Cream's 2025 Franchise Disclosure Document, the Guaranty and Assumption of Obligations agreement requires the Guarantor to be personally liable for the breach of every provision in the Franchise Agreement. This includes both monetary obligations and obligations to take or refrain from taking specific actions, or to engage or refrain from engaging in specific activities. These obligations specifically include non-competition, confidentiality, and transfer requirements outlined in the agreement.
This means that the Guarantor's responsibilities extend beyond just financial guarantees. They also encompass adherence to the brand's operational standards and protection of Cream's proprietary information. The Guarantor must not compete with Cream, must maintain confidentiality, and must adhere to the transfer requirements specified in the Franchise Agreement.
For a prospective Cream franchisee, this implies that anyone acting as a Guarantor (which may include owners, investors, or other related parties) must fully understand the scope of the Franchise Agreement. They are legally bound to ensure the franchisee complies with all aspects of the agreement, including restrictions on competitive activities and the handling of confidential information. This requirement ensures that all parties involved are committed to upholding the standards and protecting the interests of the Cream franchise system.