After the termination of a Cinnaholic franchise agreement, are the franchisee's obligations relieved?
Cinnaholic Franchise · 2025 FDDAnswer from 2025 FDD Document
In the event of termination by Franchisee, all post-termination obligations of Franchisee described herein shall not be waived but shall be strictly adhered to by Franchisee.
- 21.2.
Obligations upon Termination or Expiration.
Upon the termination or expiration of this Agreement, whether by reason of lapse of time, default in performance, abandonment of the Bakery or other cause or contingency, Franchisee shall:
(i) forthwith return to Franchisor all material furnished by Franchisor containing confidential information, operating instructions, business practices, or methods or procedures, including, without limitation, the Operations Manual;
(ii) discontinue at the Franchised Site all use of the Marks, and the use of any and all signs, products, paper goods and other items bearing the Marks.
Any signs containing the Marks which Franchisee is unable to remove within one day of the termination or expiration of this Agreement shall be completely covered by Franchisee until the time of their removal which shall be within 10 days of termination or expiration of this Agreement;
(iii) if Franchisee retains possession of the Franchised Site, at Franchisee's expense, make such reasonable modifications to the exterior and interior décor of the Bakery and the Franchised Site as Franchisor requires to eliminate its identification as a CINNAHOLIC® Bakery and to avoid violation of the non-compete provision;
(iv) refrain from operating or doing business under any name or in any manner that may give the general public the impression that this Agreement is still in force or that Franchisee is connected in any way with Franchisor or that Franchisee has the right to use the CINNAHOLIC® System or the Marks;
Source: Item 22 — CONTRACTS (FDD pages 61–62)
What This Means (2025 FDD)
According to the 2025 Cinnaholic Franchise Disclosure Document, termination of the franchise agreement does not necessarily relieve the franchisee of all obligations. The franchisee is obligated to pay liquidated damages and strictly adhere to post-termination obligations. These obligations remain in effect even if the franchisee terminates the agreement.
Upon termination or expiration of the Cinnaholic agreement, the franchisee must return all confidential materials, including the Operations Manual, to Cinnaholic. The franchisee must also discontinue all use of Cinnaholic's trademarks and related items at the franchise site. Any signs containing Cinnaholic's marks that cannot be removed within one day must be completely covered until removal within 10 days.
Furthermore, if the franchisee retains possession of the franchised site, they are responsible for making modifications to the exterior and interior to eliminate its identification as a Cinnaholic bakery. The franchisee must also refrain from operating under any name or manner that could give the impression that the agreement is still in force or that they are connected with Cinnaholic. These post-termination obligations are designed to protect Cinnaholic's brand and confidential information, and the franchisee is legally bound to comply with them.