Can Cinnaholic's acceptance of a proposed site be conditional?
Cinnaholic Franchise · 2025 FDDAnswer from 2025 FDD Document
In addition, Developer acknowledges and agrees that Franchisor's acceptance of a proposed site may be conditioned upon Developer meeting certain other requirements (including, without limitation, the negotiation of additional terms and conditions satisfactory to Franchisor to any lease, sublease or purchase agreement for the proposed site), and if Developer does not, or is unable to meet such requirements within a reasonable time, the site will be deemed rejected.
Franchisor has the right to reject any proposed site should Developer be in default of this Agreement, any Franchise Agreement entered into pursuant to this Agreement or any other agreement between Developer and Franchisor.
To be effective, any acceptance of a proposed site by Franchisor must be in writing.
Developer acknowledges and agrees that Franchisor may reject any proposed site for any reason in its sole discretion, in which event, Developer may not develop a Bakery at the rejected site, but must locate another proposed site for the Bakery and submit it to Franchisor for acceptance in accordance with this Section 7.1.
7.2.
Disclaimer.
The acquisition in any manner of any proposed site, whether by option, purchase, lease or otherwise, before written acceptance by Franchisor shall be at the sole risk and responsibility of Developer and shall not obligate Franchisor in any way to accept such site or enter into a Franchise Agreement with Developer for the operation of a CINNAHOLIC® Bakery at such site.
Source: Item 23 — RECEIPT (FDD pages 62–269)
What This Means (2025 FDD)
According to Cinnaholic's 2025 Franchise Disclosure Document, Cinnaholic's acceptance of a proposed site can be conditional. Specifically, Cinnaholic may condition its acceptance on the developer meeting certain requirements. These requirements can include negotiating additional terms and conditions that are satisfactory to Cinnaholic within any lease, sublease, or purchase agreement for the proposed site. If the developer cannot meet these requirements within a reasonable timeframe, Cinnaholic can deem the site as rejected.
This conditionality means that a prospective Cinnaholic franchisee cannot assume a site is approved simply because they have found a location they like. Cinnaholic retains significant control over site selection and can impose additional requirements that the franchisee must satisfy. This could involve complex negotiations with landlords or sellers, potentially adding time and expense to the site acquisition process.
Furthermore, the FDD states that Cinnaholic has the right to reject any proposed site if the developer is in default of the Development Agreement, any Franchise Agreement, or any other agreement between the developer and Cinnaholic. Cinnaholic can also reject any proposed site for any reason in its sole discretion. This underscores the importance of remaining in good standing with Cinnaholic and understanding that site approval is not guaranteed, even if the franchisee meets all initial criteria. The franchisee bears the risk of acquiring any site before written acceptance from Cinnaholic.
In summary, Cinnaholic franchisees should be prepared for a potentially rigorous site selection process where Cinnaholic has considerable discretion and can impose conditions on acceptance. Franchisees should carefully review all agreements and maintain open communication with Cinnaholic during the site selection phase to avoid potential delays or rejections.