During what period must a Cream franchisee and their owners not violate the Franchise Agreement to be approved for transfer?
Cream Franchise · 2025 FDDAnswer from 2025 FDD Document
- (2) you and your owners have not violated any provision of this Agreement or any other agreement with us or our affiliates during both the 60-day period before you requested our consent to the transfer and the period between your request and the effective date of the transfer, including that you have paid all Royalties, Brand Fund Contributions, and other amounts owed to us, our affiliates, and third-party suppliers, and have submitted all required reports and statements;
Source: Item 23 — RECEIPTS (FDD pages 61–192)
What This Means (2025 FDD)
According to Cream's 2025 Franchise Disclosure Document, a franchisee and their owners must not violate any provisions of the Franchise Agreement to be approved for a transfer. This requirement applies during two distinct periods. The first period is the 60-day window before the franchisee requests Cream's consent to the transfer. The second period spans from the date the franchisee submits the transfer request until the actual effective date of the transfer.
This condition ensures that franchisees remain in good standing both leading up to and throughout the transfer process. It protects Cream's interests by preventing franchisees with ongoing violations from transferring their business to another party without rectifying the issues. This also includes ensuring that all financial obligations, such as royalties and brand fund contributions, are current, and all required reports and statements have been submitted.
For a prospective Cream franchisee, this means maintaining strict compliance with the Franchise Agreement at all times, especially when considering a potential transfer. Failure to comply within these periods could result in the denial of the transfer request, potentially complicating the sale of the franchise. Franchisees should ensure they are up-to-date on all payments, reports, and operational standards to avoid any hindrances during a transfer.