Under what conditions regarding compliance failures can Cream terminate the Development Agreement, even if the Cream developer corrects the failures?
Cream Franchise · 2025 FDDAnswer from 2025 FDD Document
- (8) you (or any of your owners) (a) fail on three or more separate occasions within any 12 consecutive month period to comply with this Agreement, whether or not we notify you of the failures, and, if we do notify you of the failures, whether or not you correct the failures after our delivery of notice to you; or (b) fail on two or more separate occasions within any 12 consecutive month period to comply with the same obligation under this Agreement, whether or not we notify you of the failures, and, if we do notify you of the failures, whether or not you correct the failures after our delivery of notice to you;
Source: Item 23 — RECEIPTS (FDD pages 61–192)
What This Means (2025 FDD)
According to Cream's 2025 Franchise Disclosure Document, Cream can terminate the Development Agreement under specific conditions, even if the developer attempts to correct the failures. Cream outlines scenarios where repeated non-compliance, even if corrected, can lead to termination.
Specifically, if a Cream developer fails to comply with the Development Agreement on three or more separate occasions within any 12-month period, Cream has grounds for termination. This applies whether or not Cream notifies the developer of these failures and regardless of whether the developer corrects the failures after receiving notice. Similarly, if the developer fails to comply with the same obligation under the agreement on two or more separate occasions within a 12-month period, Cream can terminate the agreement, irrespective of notification or correction.
This policy emphasizes the importance of consistent compliance with the Development Agreement. Even if a developer addresses individual instances of non-compliance, a pattern of repeated failures can still result in the termination of the agreement by Cream. This highlights the need for Cream developers to maintain a high level of operational and contractual adherence to avoid potential termination, even if they rectify issues as they arise.