If a Cinnaholic developer makes an unauthorized transfer of the Development Agreement, can Cinnaholic terminate the Development Agreement?
Cinnaholic Franchise · 2025 FDDAnswer from 2025 FDD Document
(xi) Developer makes an unauthorized Transfer of this Agreement, the franchise, any Bakery, or an ownership interest in Developer;
13.2.
Assignment by Developer.
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 the 2025 Cinnaholic Franchise Disclosure Document, Cinnaholic can terminate the Development Agreement with a developer if the developer makes an unauthorized transfer of the agreement. Specifically, if the developer attempts to subfranchise, sell, assign, transfer, merge, convey, or encumber the Development Agreement, or allows such a transfer to occur by operation of law, without Cinnaholic's prior express written consent, it constitutes grounds for termination.
This provision protects Cinnaholic by ensuring that the developer cannot simply hand off their development rights and obligations to another party without Cinnaholic's approval. This is a standard clause in franchise agreements, as franchisors need to carefully vet and approve who is developing their brand.
For a prospective Cinnaholic developer, this means that you cannot sell or transfer your Development Agreement to someone else without first getting Cinnaholic's permission. If you do, Cinnaholic has the right to terminate the agreement, which would likely result in the loss of any development fees already paid.