What are the potential consequences for a Cinnaholic franchisee if they fail to make prompt payments for supplies, equipment, or other items related to the Bakery?
Cinnaholic Franchise · 2025 FDDAnswer from 2025 FDD Document
The failure or repeated delay in making prompt payments in accordance with the terms of invoices and statements rendered to Franchisee for purchases of supplies, equipment and other items, whether purchased from Franchisor or others, or defaults in making payments due hereunder or under any other agreement entered into in connection with the operation of the Bakery, will result in a loss of credit rating and standing which will be detrimental to Franchisor and other franchisees of the CINNAHOLIC® System. Franchisee agrees to pay when due all amounts which it owes to anyone for supplies, equipment and other items used in connection with the Bakery and all payments owed hereunder or under any other agreement entered into in connection with the operation of the Bakery. Franchisee must notify Franchisor immediately when and if Franchisee becomes more than 90 days delinquent in the payment of any of the obligations mentioned above.
Source: Item 22 — CONTRACTS (FDD pages 61–62)
What This Means (2025 FDD)
According to Cinnaholic's 2025 Franchise Disclosure Document, a franchisee's failure or repeated delay in making prompt payments for supplies, equipment, or other items can have negative repercussions. This includes a loss of credit rating and standing, which Cinnaholic considers detrimental to both the franchisor and other franchisees within the Cinnaholic system.
To avoid these consequences, a Cinnaholic franchisee must pay all amounts owed for supplies, equipment, and other items used in connection with the bakery when due. This obligation extends to any payments owed under any agreement related to the operation of the bakery.
Furthermore, the franchisee has a responsibility to inform Cinnaholic immediately if they become more than 90 days delinquent in payment of any of these obligations. This notification requirement underscores the importance Cinnaholic places on maintaining the financial health and creditworthiness of its franchisees and the potential impact of payment delays on the overall Cinnaholic brand.