When is Cinnaholic Franchising LLC deemed to have assumed all obligations of the Tenant/Lessee in the Lease?
Cinnaholic Franchise · 2025 FDDAnswer from 2025 FDD Document
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, the Franchisor, is not liable for rent or any obligation of the tenant under the lease unless it exercises its option regarding the leased premises. Until Cinnaholic exercises this option, the tenant remains responsible for all rent and obligations associated with the lease.
This arrangement protects Cinnaholic from being automatically responsible for a franchisee's lease obligations. It allows Cinnaholic to step in and assume the lease if a franchisee defaults, but it is not obligated to do so. This provides Cinnaholic with flexibility in managing its risk and supporting its franchisees.
For a prospective Cinnaholic franchisee, this means they are solely responsible for fulfilling the terms of their lease agreement unless Cinnaholic specifically chooses to assume the lease. Therefore, franchisees must carefully evaluate their financial capacity to meet their lease obligations. It is important to maintain a strong relationship with the landlord and adhere to all lease terms to avoid default, which could potentially lead to Cinnaholic stepping in.