What is the required wording of the legend that must be endorsed on stock certificates for a Cinnaholic franchise?

According to the 2025 Cinnaholic Franchise Disclosure Document, if a Cinnaholic franchisee or an equity holder is a corporation, limited liability company, partnership, business trust, or similar entity with certificated equity interests, all stock or equity certificates must have a specific legend conspicuously endorsed upon them. This requirement ensures that any potential transfer of equity interests is subject to the franchisor's prior written consent.

The purpose of this endorsement is to maintain control over who becomes involved in the ownership of a Cinnaholic franchise. Cinnaholic wants to ensure that all owners meet their standards and are approved by them, which is a common practice in franchising to protect the brand and maintain consistency across all locations. This requirement is outlined in Section 19.2 of the franchise agreement, which deals with assignment by the franchisee.

For a prospective Cinnaholic franchisee, this means that if their business is structured as a corporation or similar entity, they must ensure that all stock certificates include the specified legend. Failing to do so could result in any transfer of equity being deemed void and without effect, potentially leading to legal and contractual issues with Cinnaholic. Franchisees should consult with legal counsel to ensure full compliance with this requirement when structuring their business and issuing equity.