If a Cream franchisee makes a material misrepresentation in acquiring rights under the agreement, what action can Cream take?
Cream Franchise · 2025 FDDAnswer from 2025 FDD Document
We may terminate this Agreement, effective upon delivery of written notice to you, if:
(1) you or any of your owners have made or make any material misrepresentation or omission in acquiring the rights under this Agreement or in operating your Shop;
Source: Item 23 — RECEIPTS (FDD pages 61–192)
What This Means (2025 FDD)
According to the 2025 FDD, Cream has the right to terminate the Franchise Agreement with a franchisee if the franchisee or any of their owners makes a material misrepresentation or omission when acquiring rights under the agreement or while operating their shop. The termination is effective immediately upon delivery of written notice to the franchisee.
This provision gives Cream a strong recourse if a franchisee provides false or misleading information during the franchise application process or at any point during the operation of the Cream shop. Material misrepresentations could include inaccuracies in financial statements, failure to disclose relevant business experience, or any other information that could impact Cream's decision to award the franchise.
For a prospective Cream franchisee, this highlights the importance of honesty and transparency throughout the franchise acquisition and operation. Any misrepresentation, even if unintentional, could lead to the termination of the agreement and loss of the franchise. Franchisees should ensure all information provided to Cream is accurate and complete to avoid potential issues.