Under what conditions can Cinnaholic terminate a franchise in Michigan before the expiration of its term?
Cinnaholic Franchise · 2025 FDDAnswer from 2025 FDD Document
THE STATE OF MICHIGAN PROHIBITS CERTAIN UNFAIR PROVISIONS THAT ARE SOMETIMES IN FRANCHISE DOCUMENTS. IF ANY OF THE FOLLOWING PROVISIONS ARE IN THESE FRANCHISE DOCUMENTS, THE PROVISIONS ARE VOID AND CANNOT BE ENFORCED AGAINST YOU:
- (C) A PROVISION THAT PERMITS A FRANCHISOR TO TERMINATE A FRANCHISE BEFORE THE EXPIRATION OF ITS TERM EXCEPT FOR GOOD CAUSE.
GOOD CAUSE SHALL INCLUDE THE FAILURE OF THE FRANCHISEE TO COMPLY WITH ANY LAWFUL PROVISIONS OF THE FRANCHISE AGREEMENT AND TO CURE SUCH FAILURE AFTER BEING GIVEN WRITTEN NOTICE THEREOF AND A REASONABLE OPPORTUNITY, WHICH IN NO EVENT NEED BE MORE THAN 30 DAYS, TO CURE SUCH FAILURE.
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS, AND TRAINING (FDD pages 27–35)
What This Means (2025 FDD)
According to Cinnaholic's 2025 Franchise Disclosure Document, Michigan law impacts the franchisor's ability to terminate a franchise agreement before its term expires. Specifically, Cinnaholic can only terminate a franchise agreement before its expiration for "good cause."
"Good cause" is defined as the franchisee's failure to comply with any lawful provisions of the franchise agreement. However, Cinnaholic must provide the franchisee with written notice of the failure and a reasonable opportunity to correct it.
Notably, the FDD specifies that the opportunity to cure the failure need not be more than 30 days. This means that if a Cinnaholic franchisee in Michigan violates the franchise agreement, they have a limited time to rectify the issue before Cinnaholic can terminate the agreement. This provision ensures some protection for franchisees against arbitrary termination while also allowing Cinnaholic to maintain standards and compliance within its franchise system.