What is considered a 'Designated Bank Account' for Cinnabon, and what responsibilities does the franchisee have regarding this account?
Cinnabon Franchise · 2025 FDDAnswer from 2025 FDD Document
As used herein, the term "Designated Bank Account" means the bank account on file with Franchisor for EFT payments required under the Franchise Agreement or Manuals.
Franchisee is responsible for maintaining sufficient funds in the Designated Bank Account for all Comprehensive Support Fees due under this Agreement, in addition to any amounts drafted by EFT under the Franchise Agreement and the Manuals.
In the event there are insufficient funds in the Designated Bank Account to cover the draft of a payment due hereunder, Company reserves the right to charge Franchisee the return costs charged by Franchisor's bank and an administrative fee to cover Franchisor's and/or Company's cost of addressing the nonpayment.
Source: Item 23 — Receipts (FDD pages 114–399)
What This Means (2025 FDD)
According to Cinnabon's 2025 Franchise Disclosure Document, the Designated Bank Account is the account the franchisee has on file with Cinnabon for Electronic Funds Transfer (EFT) payments required under the Franchise Agreement or the Manuals. This account is used by Cinnabon to draft payments for Comprehensive Support Fees.
Cinnabon franchisees are responsible for ensuring that sufficient funds are available in the Designated Bank Account to cover all Comprehensive Support Fees due under the agreement. This is in addition to any other amounts that may be drafted via EFT as outlined in the Franchise Agreement and the Manuals.
If a Cinnabon franchisee fails to maintain sufficient funds in the Designated Bank Account, the company reserves the right to charge the franchisee for any return costs incurred by the franchisor's bank due to the nonpayment. Additionally, Cinnabon may charge an administrative fee to cover the costs associated with addressing the nonpayment. This administrative fee is separate from any interest that may accrue on the overdue amount. Time is of the essence when it comes to payment obligations.