If the Cream franchisee does not complete the sale within 60 days, what right does Cream or its designee have?

According to Cream's 2025 Franchise Disclosure Document, if a franchisee does not complete the sale of their franchise to a proposed buyer within 60 days after Cream notifies the franchisee that it will not exercise its right of first refusal, Cream or its designee will have an additional right of first refusal. This additional right is on the same terms as the original right of first refusal. The franchisee also has a duty to promptly inform Cream of any material changes to the terms of the sale.

In practical terms, this means that even after Cream initially declines to buy back the franchise, it retains the option to reconsider if the sale to the third-party buyer is not finalized within the specified timeframe or if the sale terms change significantly. This protects Cream's interests by allowing them to reassess the situation if the initial sale falls through or the deal changes.

For a prospective Cream franchisee, this clause highlights the importance of completing the sale quickly and keeping Cream informed of any changes to the sale terms. Failure to do so could give Cream another opportunity to purchase the franchise, potentially disrupting the franchisee's plans to sell to their preferred buyer. This is a fairly standard clause in franchise agreements, designed to give the franchisor control over who enters their system.