What is a 'Protected Territory' under the Cream Franchise Agreement?

According to Cream's 2025 Franchise Disclosure Document, a franchisee will not receive an exclusive territory under the Franchise Agreement. However, as long as the franchisee is in compliance with the Franchise Agreement and all other agreements with Cream and its affiliates, neither Cream nor its affiliates will establish or operate or authorize any other person to establish or operate a Cream Scoop Shop in the geographic area designated in the Franchise Agreement; this area is the franchisee's "Protected Territory".

Even within a franchisee's protected territory, Cream retains significant rights. Cream can establish other businesses and distribution channels, excluding Cream Scoop Shops, that offer similar or competitive products, including selling Cream-branded products at third-party businesses. Cream can also establish Cream Scoop Shops, or other businesses using the Cream system, in non-traditional venues like airports, hospitals, casinos, parks, hotels, military bases, universities, and stadiums, even within the Protected Territory. Cream can conduct marketing and promotional activities within the Protected Territory, including product giveaways and sales of similar products.

Furthermore, Cream retains the right to be acquired by or acquire any other business, including those that are similar to or competitive with Cream Scoop Shops, even within the Protected Territory. In the event of such an acquisition, Cream or the acquiring entity can continue to operate or authorize others to operate these businesses within the Protected Territory. Cream can also engage in any activities not expressly prohibited by the Franchise Agreement within the Protected Territory. Cream is not required to pay the franchisee if it exercises any of these rights. These stipulations significantly limit the protections a Cream franchisee receives, as Cream retains considerable freedom to operate and compete within the franchisee's territory.