Must the Franchisee use the Franchised Site exclusively to operate a Cinnaholic Bakery?
Cinnaholic Franchise · 2025 FDDAnswer from 2025 FDD Document
reholders, managers, members, partners, employees and agents; and (ix) Franchisee provides Franchisor with evidence that Franchisee has the right to remain in possession of the Franchised Site or to secure and develop a suitable alternative site acceptable to Franchisee for the renewal term.
3. FRANCHISED SITE AND TERRITORY
- 3.1. Franchised Site. The rights granted to Franchisee hereunder shall be non-exclusive and shall be restricted to the operation of a single CINNAHOLIC® Bakery to be located at the address and location set forth on Exhibit A attached hereto (the "Franchised Site"). During the term of this Agreement, the Franchised Site shall be used exclusively to operate a Bakery. In connection with the execution of any lease or sublease for the Franchised Site, Franchisee must execute, and cause the lessor and/or sublessor of the Franchised Site to execute, the Collateral Assignment of Lease attached to the Market Development Agreement entered into between Franchisor and Franchisee (the "Development Agreement"), in addition to complying with any other obligations and conditions contained in the Development Agreement relating to the lease or sublease of the Franchised Site and the development and construction of the Bakery. The rights granted to Franchisee are for the specific Franchised Site and cannot be transferred to any other location, except with Franchisor's prior written approval. After you sign a lease for the Franchised Site, you will pay us a Project Management Fee, currently $1,795, and we will assist you in developing your Bakery site but monitoring construction and build-out progress, attempting to identify potential bottlenecks, and otherwise help expedite pre-construction activities.
- 3.2. Territorial Protection. Franchisor will not establish for itself or grant a franchise to any other party to establish a Bakery within the territory specified on Exhibit A attached hereto (the "Franchise Territory"). Notwithstanding anything herein to the contrary, if any disagreement arises regarding the area comprising the Franchise Territory, then Franchisor's decision as to the definition of the Franchise Territory shall be final and binding.
Source: Item 22 — CONTRACTS (FDD pages 61–62)
What This Means (2025 FDD)
According to Cinnaholic's 2025 Franchise Disclosure Document, the franchisee's rights are restricted to operating a single Cinnaholic Bakery at the specific location outlined in Exhibit A, referred to as the "Franchised Site." During the term of the Franchise Agreement, the Franchised Site must be used exclusively for operating a Cinnaholic bakery. The rights granted to the franchisee are site-specific and cannot be transferred to another location without Cinnaholic's prior written approval.
This means a Cinnaholic franchisee cannot operate any other type of business from the Franchised Site. The franchisee's activities at the location must be solely focused on the Cinnaholic bakery. This restriction ensures brand consistency and prevents the dilution of the Cinnaholic brand by associating it with other business ventures at the same location.
Furthermore, the franchisee is required to use the trademarks only for the operation of the bakery at the Franchised Site or in advertising for the business conducted at or from that location. The franchisee is also obligated to prominently display signs with the Cinnaholic name and other signs as directed or approved by Cinnaholic. They must also avoid displaying any signs or advertising that Cinnaholic objects to. These stipulations reinforce the exclusive use of the site for the Cinnaholic business and maintain brand uniformity.