If the Franchise Agreement is terminated, what option does Cinnaholic Franchising LLC have regarding the Leased Premises?
Cinnaholic Franchise · 2025 FDDAnswer from 2025 FDD Document
the have assumed expressly all of the the party of the first part, and Tenant under the terms and | performance of the Lease Franchisor shall have the option Franchisor elects to exercise said written notice of its election not have the right of possession receipt of notice of Tenant/Lessee in said Lease in the place and instead of terms, shall likewise be entitled conditions of the Lease, with the | or the Franchise of taking over option of taking to do so shall of the Leased exercise of such option, covenants, and obligations of the to enjoy all of the right to reassign | 3. That Franchisor shall have the right, but shall not be obligated, to cure any default by Tenant under the Lease within Tenant's cure period under the Lease, or within thirty (30) days after the expiration of Tenant's cure period under the Lease, provided that prior to the expiration of Tenant's cure period under the Lease, Franchisor notifies Landlord in writing that Franchisor intends to cure such default;
same to any tenant or franchisee who can demonstrate a net worth of $250,000, or otherwise to a
- 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 has the right, but not the obligation, to cure any default by the tenant (franchisee) under the lease. This means that if a franchisee fails to meet their lease obligations, Cinnaholic can step in to correct the issue.
To exercise this right, Cinnaholic must notify the landlord in writing of its intent to cure the default before the franchisee's cure period expires. Cinnaholic then has either the remainder of the franchisee's cure period or 30 days after its expiration to resolve the default. This provision protects Cinnaholic's interest in maintaining the location and brand presence, as well as potentially finding a new franchisee for the site.
The FDD also clarifies that if Cinnaholic does not exercise its option to cure the default, it is not liable for the rent or any other obligations of the tenant under the lease. The franchisee remains responsible for all lease-related payments and obligations unless Cinnaholic assumes them by curing the default. Additionally, the franchisee cannot modify or terminate the lease without Cinnaholic's written consent, giving Cinnaholic further control over the leased premises.
Furthermore, the franchisee agrees to give Cinnaholic an interest superior to the lessor on all the tenant's trade fixtures to secure the tenant's performance of the lease and the franchise agreement. This includes all merchandise, signs, fixtures, furniture, furnishings, partitions, and equipment installed and owned by the tenant. This provides Cinnaholic with additional security and leverage in the event of a default or termination.