Who pays for the expense of collection agents or legal proceedings to collect Brand Fund contributions for Cream?
Cream Franchise · 2025 FDDAnswer from 2025 FDD Document
We will account for the Brand Fund separately from our other funds. However, neither we nor any of our affiliates has any fiduciary obligation to you or any other person for administering the Brand Fund. The Brand Fund may spend in any fiscal year more or less than the total Brand Fund Contributions in that year, borrow from us or others (paying reasonable interest) to cover deficits, or invest any surplus for future use. We may administer the Brand Fund through a separate entity whenever we deem appropriate, and such entity will have all of the rights and duties specified herein. We have the right, but no obligation, to use collection agents and institute legal proceedings to collect Brand Fund Contributions at the Brand Fund's expense. We may also forgive, waive, settle, and compromise all claims by or against the Brand Fund in our sole discretion.
Source: Item 23 — RECEIPTS (FDD pages 61–192)
What This Means (2025 FDD)
According to Cream's 2025 Franchise Disclosure Document, the Brand Fund bears the expense of collection agents and legal proceedings used to collect Brand Fund contributions. Cream retains the right, but not the obligation, to employ collection agents and initiate legal action to recover unpaid Brand Fund Contributions. These costs are to be paid by the Brand Fund itself.
This means that if a Cream franchisee fails to make the required Brand Fund contributions, the Brand Fund will cover the costs associated with pursuing the debt. This arrangement protects Cream from incurring these expenses directly and ensures that the Brand Fund is used to maintain its financial health.
It is important to note that Cream has the right to forgive, waive, settle, and compromise claims against the Brand Fund at its discretion. This provides Cream with flexibility in managing the Brand Fund's finances and dealing with delinquent accounts. Prospective franchisees should understand that while the Brand Fund covers collection costs, Cream ultimately decides how aggressively to pursue unpaid contributions.