Is Cream limited to recovering only Lost Revenue Damages if a franchisee breaches the agreement?

According to Cream's 2025 Franchise Disclosure Document, Cream is not limited to recovering only Lost Revenue Damages if a franchisee breaches the agreement. While the agreement outlines a specific calculation for Lost Revenue Damages, it explicitly states that this calculation does not prevent Cream from pursuing and recovering other damages resulting from the franchisee's breach.

Lost Revenue Damages are defined as the net present value of Royalties and Brand Fund Contributions that would have been due from the termination date to the earlier of the second anniversary of the termination date or the scheduled expiration of the agreement's term. These amounts are calculated based on the average monthly Net Sales of the franchisee's shop over the 12 months preceding the last date of regular operations. If the shop has not been operating for at least 12 months, the calculation will be based on the average monthly Net Sales of all Jeni's Ice Creams Scoop Shops during Cream's last fiscal year.

This provision means that Cream retains the right to seek additional compensation beyond the calculated Lost Revenue Damages for any harm caused by a franchisee's breach of the franchise agreement. A prospective franchisee should be aware that the Lost Revenue Damages clause provides a baseline for damages but does not cap Cream's potential recovery. Cream could pursue other types of damages, such as costs associated with correcting the breach, reputational harm, or other consequential losses. Franchisees should consult with a legal professional to fully understand their potential liability in the event of a breach.