What happens if the terms of the proposed transfer are not satisfactory to the Cinnaholic Franchisor?
Cinnaholic Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisor's approval of any Transfer is, in all cases, contingent upon the following:
(i) the purchaser and/or the controlling persons of the purchaser having a satisfactory credit rating, being of good moral character, having business qualifications satisfactory to Franchisor, and being willing to enter into an agreement in writing to assume and perform all of Developer's duties and obligations hereunder and/or enter into a new Market Development Agreement for the Area of Responsibility, if so requested by Franchisor, and agreeing to enter into any and all agreements with Franchisor that are being required of all new market developers, including a guaranty agreement and any other agreement which may require payment of different or increased fees from those paid under this Agreement;
(ii) the terms and conditions of the proposed transfer (including, without limitation, the purchase price) being satisfactory to Franchisor;
Source: Item 23 — RECEIPT (FDD pages 62–269)
What This Means (2025 FDD)
According to Cinnaholic's 2025 Franchise Disclosure Document, the franchisor's approval of any transfer of the franchise is contingent upon several factors. One of these conditions is that "the terms and conditions of the proposed transfer (including, without limitation, the purchase price) being satisfactory to Franchisor."
This means that Cinnaholic has the right to reject a proposed transfer if it deems the terms, including the purchase price, to be unsatisfactory. This gives Cinnaholic significant control over who becomes a franchisee and the financial terms of the transfer.
For a prospective franchisee, this highlights the importance of negotiating transfer terms that will be acceptable to Cinnaholic. It also underscores the need to understand Cinnaholic's criteria for evaluating potential transferees and transfer agreements. If Cinnaholic rejects the transfer, the franchisee will not be able to proceed with the sale.