How long after termination or expiration of the Cream franchise agreement does Cream have to provide written notice to exercise its option to purchase the Shop?
Cream Franchise · 2025 FDDAnswer from 2025 FDD Document
D. OUR RIGHT TO PURCHASE YOUR SHOP.
We have the option to purchase any or all of the assets of your Shop, including your Premises (if you or one of your owners or affiliates owns the Premises) upon termination or expiration of this Agreement. We have the unrestricted right to assign this option to purchase. We may exercise this option by giving you written notice within 30 days after the date of such termination or expiration. The purchase price for your Shop will be the net realizable value of the tangible assets in accordance with the liquidation basis of accounting (not the value of your Shop as a going concern). If you dispute our calculation of the purchase price, the purchase price will be determined by one independent accredited appraiser designated by us who will calculate the purchase price applying the criteria specified above. We agree to select the appraiser within 15 days after we receive the financial and other information necessary to calculate the purchase price (if you, and we have not agreed on the purchase price before then). You and we will share equally the appraiser's fees and expenses. The appraiser must complete its calculation within 30 days after its appointment. We may set off against the purchase price, and reduce the purchase price by, any and all amounts you or your owners owe us or our affiliates.
Source: Item 23 — RECEIPTS (FDD pages 61–192)
What This Means (2025 FDD)
According to Cream's 2025 Franchise Disclosure Document, Cream has the option to purchase the assets of your Shop, including the premises, upon the termination or expiration of the franchise agreement. To exercise this option, Cream must provide written notice to the franchisee within 30 days after the date of termination or expiration.
This means that if a franchisee's agreement is terminated or expires, Cream has a limited time frame to decide whether it wants to buy the Shop's assets. The purchase price will be based on the net realizable value of the tangible assets, calculated according to the liquidation basis of accounting, not the Shop's value as an ongoing business.
If the franchisee disagrees with Cream's valuation of the purchase price, an independent appraiser selected by Cream will determine the price, applying the same criteria. The cost of the appraiser is split equally between the franchisee and Cream, and the appraiser has 30 days to complete the valuation after being appointed. Cream can also deduct any amounts the franchisee owes Cream or its affiliates from the purchase price. This clause ensures Cream can recover outstanding debts during the purchase.