What is the condition for the Franchisor to exercise the option of taking over the Lease for a Cinnaholic franchise?
Cinnaholic Franchise · 2025 FDDAnswer from 2025 FDD Document
That Franchisor shall have the right, but shall not be obligated, to cure any default by Tenant under the Lease within Tenant's cure period under the Lease, or within thirty (30) days after the expiration of Tenant's cure period under the Lease, provided that prior to the expiration of Tenant's cure period under the Lease, Franchisor notifies Landlord in writing that Franchisor intends to cure such default;
It is understood and agreed that so long as Franchisor shall not have exercised its option under the foregoing provisions hereof as to the Leased Premises, Franchisor shall not be liable for rent or any obligation of Tenant under and by virtue of or in connection with the Lease, and Tenant shall remain liable for such rent and obligations;
Source: Item 23 — RECEIPT (FDD pages 62–269)
What This Means (2025 FDD)
According to Cinnaholic's 2025 Franchise Disclosure Document, Cinnaholic Franchising, LLC has the right, but not the obligation, to cure any default by the tenant (franchisee) under the lease. This is possible within the tenant's cure period as defined in the lease, or within thirty days after the tenant's cure period expires.
However, for Cinnaholic to exercise this right, it must notify the landlord in writing before the tenant's cure period expires that it intends to cure the default. If Cinnaholic has not exercised its option to take over the leased premises, it will not be liable for rent or any other obligations of the tenant under the lease. The tenant remains responsible for these obligations.
This clause protects Cinnaholic by giving it the option to step in and save a location if a franchisee is struggling, but it does not obligate them to do so. It also ensures that Cinnaholic is not responsible for the franchisee's lease obligations unless it explicitly takes over the lease.