Under what circumstances does Cream have an additional right of first refusal?
Cream Franchise · 2025 FDDAnswer from 2025 FDD Document
| is not being managed properly at any time from and after the death or disability of you (if you | If you do not complete the sale to the proposed buyer within 60 days after we notify you that |
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| we do not intend to exercise our right of first refusal, or if there is a material change in the terms of the | |
| sale (which you agree to tell us promptly), we or our designee will have an additional right of first | |
| refusal on the same terms as described above. |
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, Cream has an additional right of first refusal under specific circumstances related to the sale of the franchise. If a franchisee does not complete the sale to a proposed buyer within 60 days after Cream notifies the franchisee that it will not exercise its initial right of first refusal, Cream retains an additional right of first refusal.
Additionally, if there is a material change in the terms of the sale, which the franchisee is obligated to promptly communicate to Cream, Cream or its designee will have an additional right of first refusal. This additional right is on the same terms as the original right of first refusal.
This provision ensures that Cream maintains control over who becomes a franchisee and under what terms the franchise is transferred. It also protects Cream from having a franchisee change the terms of a sale to something unacceptable after Cream has already declined the initial offer. For a prospective franchisee, this means they must adhere to the original terms of the offer presented to Cream and complete the sale promptly after Cream waives its initial right. Failure to do so gives Cream another opportunity to purchase the franchise or approve the new buyer and terms.