Under what condition is the payment of the Initial Franchise Fees for a Cinnaholic franchise in Minnesota deferred?

According to the 2025 Cinnaholic Franchise Disclosure Document, the payment of Initial Franchise Fees in Minnesota is initially deferred based on the franchisor's financial statements. The Commissioner of Commerce for the State of Minnesota mandates this deferral until Cinnaholic fulfills all its initial obligations to the franchisee under the Franchise Agreement and any other agreements. This means Cinnaholic must complete its responsibilities, such as providing training, site selection assistance, and other pre-opening support, before the franchisee is required to pay the initial franchise fee.

However, this deferral is only temporary. Once Cinnaholic has met its obligations and the franchisee commences business operations, the Initial Franchise Fees become due immediately and must be paid in full. This implies that while franchisees in Minnesota get a grace period before paying the fee, they must be prepared to pay the full amount as soon as their Cinnaholic business opens.

This condition is based on Cinnaholic's initial financial statements and is designed to protect franchisees by ensuring that the franchisor fulfills its initial promises before receiving the franchise fee. Prospective franchisees in Minnesota should confirm with Cinnaholic that all obligations have been met before commencing business to avoid any potential disputes regarding the timing of the Initial Franchise Fee payment.