In Michigan, can Cinnaholic prevent a transfer of ownership if the proposed transferee is a competitor?

According to Cinnaholic's 2025 Franchise Disclosure Document, Michigan law addresses the franchisor's ability to prevent franchise transfers. Specifically, Cinnaholic can refuse a transfer if the proposed transferee is a competitor. This is explicitly stated as a valid reason for the franchisor to withhold approval of a transfer.

This provision means that if a Cinnaholic franchisee in Michigan attempts to sell their franchise to an individual or entity that directly competes with Cinnaholic, the franchisor has the right to block the sale. This protects Cinnaholic's market position and confidential business information. The franchisor's decision must be based on the potential transferee being an actual competitor.

For a prospective Cinnaholic franchisee in Michigan, this highlights the importance of understanding transfer conditions. If they plan to sell their franchise in the future, they need to be aware that selling to a competitor is not an option. This restriction is designed to safeguard the Cinnaholic brand and business model from being undermined by competitors gaining access through franchise acquisition.