What happens if a Cream developer fails to comply with the Development Schedule, regarding termination of Development Rights?
Cream Franchise · 2025 FDDAnswer from 2025 FDD Document
aragraphs; (3) you have paid all associated fees for such Jeni's Ice Creams Scoop Shop arising under this Agreement and/or the Franchise Agreement; (4) you have executed a lease agreement or otherwise acquired occupancy rights to that premises on the terms described in your Franchise Agreement; and (5) you have secured our approval to open such Jeni's Ice Creams Scoop Shop, and such Jeni's Ice Creams Scoop Shop is open and operating in full compliance with its Franchise Agreement.
D. DEVELOPMENT DEFAULTS.
If you fail to comply with the Development Schedule, we reserve the right to terminate or reduce the size of your Development Area, and/or terminate the territorial protections that you have in some or all of your Development Area under Section 1.D, after which time we and our affiliates may establish or operate or authorize any other person to establish or operate a Jeni's Ice Creams Scoop
Shop in your current or former Development Area in our discretion. Notwithstanding the foregoing, nothing contained in this Section shall be deemed a waiver of our right to terminate this Agreement for failure to comply with the Development Schedule.
E. BUSINESS PLAN AND REPORTING.
Within 60 days after the Effective Date, you must prepare and give us a business plan including a projected schedule for Jeni's Ice Creams Scoop Shop development and detailed cost and revenue projections for your activities under this Agreement. At least 90 days before the start of each calendar year during the Term, you must update the business plan to cover both actual results for the previous year and projections for the then-current year.
Source: Item 23 — RECEIPTS (FDD pages 61–192)
What This Means (2025 FDD)
According to Cream's 2025 Franchise Disclosure Document, if a developer fails to comply with the Development Schedule, Cream reserves the right to take certain actions. These actions include terminating or reducing the size of the Development Area, and/or terminating the territorial protections that the developer has in some or all of their Development Area. After such actions, Cream and its affiliates have the right to establish or operate, or authorize any other person to establish or operate, a Jeni's Ice Creams Scoop Shop in the developer's current or former Development Area at their discretion.
It is important to note that Cream's right to take these actions does not waive its right to terminate the Development Agreement entirely due to the failure to comply with the Development Schedule. This means that in addition to reducing the Development Area or terminating territorial protections, Cream can still choose to terminate the entire agreement.
Furthermore, Cream may terminate the Development Agreement if the developer fails to comply with the Development Schedule. This termination is effective upon delivery of written notice to the developer. Upon termination or expiration of the Development Agreement, the developer must immediately cease conducting the business, return or destroy any and all Confidential Information, comply with all standards established by Cream, and pay all amounts owing to Cream pursuant to the agreement up to the date of termination.