If a Cream franchisee fails to comply with the Development Schedule, can Cream or its affiliates establish or operate a Jeni's Ice Creams Scoop Shop in the franchisee's current or former Development Area?

According to Cream's 2025 Franchise Disclosure Document, if a franchisee fails to comply with the Development Schedule, Cream reserves specific rights. Cream can terminate or reduce the size of the Development Area and/or terminate the territorial protections in some or all of the Development Area. After such actions, Cream and its affiliates have the discretion to establish, operate, or authorize others to establish or operate a Jeni's Ice Creams Scoop Shop in the franchisee's current or former Development Area.

This means that a franchisee's failure to meet the agreed-upon Development Schedule can result in a loss of territorial exclusivity and the potential for direct competition from Cream or its affiliates within the area the franchisee was initially granted rights to develop. The Development Schedule is outlined in Attachment B of the Area Development Agreement, setting forth the timeline and number of Jeni's Ice Creams Scoop Shops the franchisee must develop. Cream emphasizes that the Development Schedule is based on the franchisee's own investigation and determination of their ability to meet these obligations.

Cream also retains the right to terminate the Area Development Agreement for failure to comply with the Development Schedule, regardless of whether they choose to reduce the Development Area or terminate territorial protections. This provision underscores the importance of adhering to the Development Schedule and the potential consequences of non-compliance for Cream franchisees.