What section outlines the requirements that must be satisfied for a Cinnaholic franchisee transfer to be approved?
Cinnaholic Franchise · 2025 FDDAnswer from 2025 FDD Document
- 19.4.
Approval of Assignment.
Franchisor's approval of any Transfer is, in all cases, contingent upon the following: the purchaser and/or the controlling persons of the purchaser having a satisfactory credit rating, being of good moral character, having business qualifications satisfactory to Franchisor, being willing to comply with Franchisor's training requirements and being willing to enter into an agreement in writing to assume and perform all of Franchisee's duties and obligations hereunder and/or enter into a new Franchise Agreement, if so requested by Franchisor, and agreeing to enter into any and all agreements with Franchisor that are being required of all new franchisees, including a guaranty agreement, or any other agreement which may require payment of different or increased fees from those paid under this Agreement; provided, however, the amount of the Royalty Fees paid hereunder shall not be increased upon an assignment;
Source: Item 22 — CONTRACTS (FDD pages 61–62)
What This Means (2025 FDD)
According to the 2025 Cinnaholic FDD, Section 19.4 outlines the requirements for approval of any transfer of the franchise. Franchisor approval is contingent upon several factors related to the purchaser. These factors include the purchaser's credit rating, moral character, and business qualifications, all of which must be satisfactory to Cinnaholic.
Additionally, the purchaser must be willing to comply with Cinnaholic's training requirements. The purchaser must also agree in writing to assume and perform all of the franchisee's duties and obligations under the existing agreement or enter into a new Franchise Agreement if Cinnaholic requests it. The purchaser must also agree to enter into any and all agreements with Cinnaholic that are being required of all new franchisees, including a guaranty agreement or any other agreement which may require payment of different or increased fees.
It is important to note that while other fees may change, the amount of Royalty Fees paid under the original agreement will not increase upon assignment. This section provides clarity on the conditions that must be met for a transfer to be approved by Cinnaholic, ensuring that any new franchisee meets the standards and obligations set by the company.