Does Cinnaholic Franchising, LLC have sole discretion to approve or disapprove a transfer of the franchise agreement?
Cinnaholic Franchise · 2025 FDDAnswer from 2025 FDD Document
Developer shall not subfranchise, sell, assign, transfer, merge, convey or encumber (each, a "Transfer") this Agreement or any of its rights or obligations hereunder, or suffer or permit any such Transfer of this Agreement or its rights or obligations hereunder to occur by operation of law or otherwise without the prior express written consent of Franchisor.
Source: Item 23 — RECEIPT (FDD pages 62–269)
What This Means (2025 FDD)
According to Cinnaholic's 2025 Franchise Disclosure Document, Cinnaholic has the right to approve or disapprove a transfer of the franchise agreement. The document states that a franchisee cannot sell, assign, transfer, or merge the agreement without prior express written consent from Cinnaholic. This means that Cinnaholic maintains control over who can operate a Cinnaholic franchise.
For a prospective franchisee, this requirement means that if they decide to sell their Cinnaholic franchise, they must obtain Cinnaholic's approval. Cinnaholic can deny the transfer at its discretion. This protects Cinnaholic by ensuring that any new franchisee meets their standards and is capable of maintaining the brand's reputation and operational standards.
This level of control is typical in franchising. Franchisors want to ensure that new operators are qualified and a good fit for the system. While this requirement provides Cinnaholic with significant control, it also offers some assurance to other franchisees that standards will be maintained across the Cinnaholic system. A prospective franchisee should inquire about the specific criteria Cinnaholic uses to evaluate potential transferees to better understand the likelihood of approval.