What section of the Cream Franchise Agreement discusses the franchisor's option to purchase the franchisee's business?
Cream Franchise · 2025 FDDAnswer from 2025 FDD Document
, and related agreements. You should read these provisions in the agreements attached to this Disclosure Document.**
| Provision | Agreement | Summary |
|---|---|---|
| of first refusal, or there is a material change in terms, we will have an additional right of first refusal. | ||
| (o) Franchisor’s | Franchise Agreement | We may purchase any or all of the assets of your Shop (including |
| option to | – Section 15.D | the Premises, if it is owned by you or one of your owners or |
| purchase | affiliates) upon the termination or expiration of the Franchise | |
| franchisee’s | Agreement. The purchase price will be based upon the net | |
| business | realizable value of the tangible assets in accordance with the liquidation basis of accounting. We may exercise this right by giving you written notice of our election within 30 days after the termination or expiration. If challenged, the purchase price will be determined by an appraiser designated by us, with costs and fees shared equally by both parties. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 44–51)
What This Means (2025 FDD)
According to Cream's 2025 Franchise Disclosure Document, Section 15.D of the Franchise Agreement outlines Cream's option to purchase the franchisee's business. Specifically, Cream has the option to purchase the assets of the Cream shop, including the premises if the franchisee or its affiliates own it, upon the termination or expiration of the Franchise Agreement.
The purchase price for the Cream shop will be based on the net realizable value of the tangible assets, determined using the liquidation basis of accounting. Cream must provide written notice of its intent to exercise this purchase option within 30 days after the termination or expiration of the Franchise Agreement.
If the franchisee challenges Cream's determined purchase price, an appraiser designated by Cream will determine the final price, with both parties equally sharing the costs and fees associated with the appraisal. While Cream is deciding whether to purchase the Cream shop, it may operate the shop on an interim basis, as detailed in the Franchise Agreement.