Must the terms of the proposed transfer be satisfactory to the Cinnaholic Franchisor?
Cinnaholic Franchise · 2025 FDDAnswer from 2025 FDD Document
fers). A "Disability" shall have occurred with respect to Developer if Developer, or, if Developer is a corporation, partnership or limited liability company, its controlling shareholder, partner, member or other equity holder, is unable to actively participate in its activities as Developer hereunder for any reason for a continuous period of six months. As used in this Section 13.3, "Developer" may include a disabled or deceased controlling shareholder, partner or member where the context so requires.
- 13.4. Approval of Assignment. Franchisor's approval of any Transfer is, in all cases, contingent upon the following:
- (i) 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, and being willing to enter into an agreement in writing to assume and perform all of Developer's duties and obligations hereunder and/or enter into a new Market Development Agreement for the Area of Responsibility, if so requested by Franchisor, and agreeing to enter into any and all agreements with Franchisor that are being required of all new market developers, including a guaranty agreement and any other agreement which may require payment of different or increased fees from those paid under this Agreement;
- (ii) the terms and conditions of the proposed transfer (including, without limitation, the purchase price) being satisfactory to Franchisor;
- (iii) all monetary obligations (whether hereunder or not) of Developer to Franchisor or Franchisor's affiliates or subsidiaries being paid in full;
- (iv) Developer not being in default hereunder or any other agreement between Developer and Franchisor, including any Franchise Agreement;
- (v) Developer and its owners executing a general release of any and all claims against Franchisor and its affiliates, subsidiaries, members, managers, officers, directo
Source: Item 23 — RECEIPT (FDD pages 62–269)
What This Means (2025 FDD)
According to Cinnaholic's 2025 Franchise Disclosure Document, if a franchisee wishes to transfer their agreement, the terms and conditions of the proposed transfer must be satisfactory to Cinnaholic. This includes, without limitation, the purchase price.
Cinnaholic's approval of any transfer is contingent upon several factors related to the purchaser. The purchaser and/or the controlling persons of the purchaser must have a satisfactory credit rating, be of good moral character, and possess business qualifications satisfactory to Cinnaholic. They must also be willing to enter into an agreement to assume and perform all of the current franchisee's duties and obligations, potentially including a new Market Development Agreement and any other agreements with Cinnaholic, which may require different or increased fees.
Additional conditions for transfer approval include the franchisee paying all monetary obligations to Cinnaholic and its affiliates, not being in default of any agreements, and executing a general release of claims against Cinnaholic. The franchisee must also pay a transfer fee of $5,000 plus reimbursement for all legal, training, and other expenses incurred by Cinnaholic in connection with the transfer. Furthermore, the franchisee must first offer to sell their interest to Cinnaholic, and Cinnaholic must decline the offer. The Marks cannot be used in any advertising for any transfer prohibited by the agreement.