If a Cinnaholic developer is convicted of a felony, can Cinnaholic terminate the Development Agreement?

According to the 2025 Cinnaholic Franchise Disclosure Document, Cinnaholic can terminate the Development Agreement immediately if a developer or any of the developer's owners are convicted of a felony. This also applies if they plead no contest to a felony, a crime involving moral turpitude, or any other crime or offense that is likely to adversely affect the reputation of the Cinnaholic system and the goodwill associated with its marks.

This clause protects Cinnaholic's brand image and reputation. A felony conviction, or even a plea of no contest, can significantly damage the public's perception of the franchise. The clause allows Cinnaholic to act swiftly to disassociate itself from individuals whose actions could harm the brand. This is a fairly standard clause in franchise agreements, as franchisors need to protect their brand from negative publicity.

For a prospective Cinnaholic developer, this means maintaining a clean criminal record is essential. Any past or pending charges should be carefully reviewed with legal counsel to assess the potential impact on the Development Agreement. Furthermore, the definition of "moral turpitude" can be subjective and open to interpretation, so it's crucial to understand what types of offenses Cinnaholic would consider grounds for termination. Developers should also ensure that all owners associated with the development entity also meet these standards, as their actions can also trigger termination.