Do my indemnification obligations to Cream continue to apply during any interim operation period?
Cream Franchise · 2025 FDDAnswer from 2025 FDD Document
Our decision to operate your Shop on an interim basis will not affect our right to terminate this Agreement under Section 14. Your indemnification obligations set forth under Section 16.D will continue to apply during any period that we or our designee operate your Shop on an interim basis.
Source: Item 23 — RECEIPTS (FDD pages 61–192)
What This Means (2025 FDD)
According to Cream's 2025 Franchise Disclosure Document, a franchisee's indemnification obligations continue to apply even during any interim operation period. This means that even if Cream or a third party is temporarily operating the Cream shop, the franchisee remains responsible for covering any losses, damages, or liabilities that Cream may incur related to the shop's operations.
This is a significant point for prospective Cream franchisees because it highlights that their financial responsibilities are not suspended simply because they are not directly managing the shop. The franchisee's duty to indemnify Cream remains in effect, potentially exposing them to ongoing financial risks even when Cream has taken over operations temporarily.
It is important for franchisees to understand the scope of their indemnification obligations as defined in Section 16.D of the franchise agreement. Franchisees should carefully review this section and seek legal counsel to fully grasp the potential liabilities and ensure they have adequate insurance coverage to protect themselves during any interim operation period.