Following a transfer by the Developer, for how long are the non-competition restrictions in place for a Cinnaholic franchise?
Cinnaholic Franchise · 2025 FDDAnswer from 2025 FDD Document
managers, as applicable, and their spouses (each, a "Bound Party"), agree that they will not, during the term of this Agreement, directly or indirectly, for and on behalf of itself, himself, herself or any other person or entity, (a) have any direct or indirect interest as a disclosed or beneficial owner in a Competitive Business (as defined below), regardless of location or (b) perform services as a director, officer, manager, employee, consultant, representative, agent, or otherwise for a Competitive Business, regardless of location.
(ii) Post-Term Non-Competition. In addition to and not in limitation of any other restrictions on Developer contained herein, Developer and the Bound Parties agree that they will not, for one year following the effective date of termination or expiration of this Agreement for any reason, or following the date of a Transfer by Developer, directly or indirectly, for and on behalf of itself, himself, herself or any other person or entity, (a) have any direct or indirect interest as a disclosed or beneficial owner in a Competitive Business or (b) perform services as a director, officer, manager, employee, consultant, representative, agent, or otherwise for a Competitive Business which, in either case, is located or operating within a five mile radius of any CINNAHOLIC® Bakery.
(iii) General.
Source: Item 23 — RECEIPT (FDD pages 62–269)
What This Means (2025 FDD)
According to Cinnaholic's 2025 Franchise Disclosure Document, if a Cinnaholic Developer transfers their franchise, they and any Bound Parties are subject to a one-year non-compete restriction. This restriction begins on the date of the transfer.
During this one-year period, the Developer and Bound Parties are prohibited from having a direct or indirect interest in a Competitive Business or performing services for one. This applies to any Competitive Business located or operating within a five-mile radius of any Cinnaholic Bakery.
The term "Competitive Business" includes any business involved in the retail or wholesale production or sale of baked goods, including cinnamon rolls, that derives more than 50% of its revenue from cinnamon roll sales. Standard exceptions apply, such as owning less than 5% of a publicly traded company.
Additionally, for one year following a transfer, the Developer and Bound Parties are prohibited from soliciting or interfering with the employment relationships between Cinnaholic and its employees, or between any other Cinnaholic franchisee and their employees.