Does the Cinnabon franchise agreement allow for waivers of obligations?
Cinnabon Franchise · 2025 FDDAnswer from 2025 FDD Document
NORTH DAKOTA ADDENDUM TO DISCLOSURE DOCUMENT
In recognition of the requirements of the North Dakota Franchise Investment Law, N.D. Cent. Code §§ 51-19-01 through 51-19-17, and the policies of the Office of State of North Dakota Securities Commission, the Disclosure Document for Cinnabon Franchisor SPV LLC for use in the State of North Dakota is amended as follows:
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- A contractual requirement that you sign a general release will not apply to claims you may have under the North Dakota Franchise Investment Law.
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- Covenants not to compete such as those contained in the Franchise Agreement are generally considered unenforceable in the State of North Dakota.
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- The Franchise Agreement contains provisions that may be interpreted as liquidated damages clauses. Under the North Dakota Franchise Investment Law, certain liquidated damages clauses are unenforceable.
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- The Franchise Agreement requires you to waive your right to collect exemplary or punitive damages. This provision may not be enforceable under North Dakota law.
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- The Franchise Agreement requires that you consent to the jurisdiction of a court in Georgia. This provision may not be enforceable under North Dakota Law because North Dakota Law precludes you from consenting to jurisdiction of any court outside of North Dakota.
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- The provisions of the Franchise Agreement on governing law, jurisdiction, and choice of law will not be a waiver of any right conferred on you by the North Dakota Franchise Investment Law.
RHODE ISLAND ADDENDUM TO DISCLOSURE DOCUMENT
In recognition of the requirements of the Rhode Island Franchise Investment Act, §§ 19- 28.1-1 through 19-28.1-34, the Disclosure Document for Cinnabon Franchisor SPV LLC for use in the State of Rhode Island is amended as follows by adding the following language at the end of Item 17:
Section 19-28.1-14 of the Rhode Island Franchise Investment Act provides that "A provision in a franchise agreement restricting jurisdiction or venue to a forum outside this state or requiring the application of the laws of another state is void with respect to a claim otherwise enforceable under this Act."
WASHINGTON ADDENDUM TO THE FRANCHISE DISCLOSURE DOCUMENT, THE FRANCHISE AGREEMENT, AND ALL RELATED AGREEMENTS
Source: Item 23 — Receipts (FDD pages 114–399)
What This Means (2025 FDD)
According to Cinnabon's 2025 Franchise Disclosure Document, the franchise agreement's stance on waivers of obligations varies by state. For instance, the North Dakota Addendum specifies that certain provisions in the Franchise Agreement, such as those requiring a waiver of the right to collect exemplary or punitive damages, may not be enforceable under North Dakota law. Similarly, the addendum notes that covenants not to compete are generally considered unenforceable in North Dakota. The agreement also states that consenting to the jurisdiction of a court in Georgia may not be enforceable under North Dakota law. These stipulations suggest that Cinnabon's standard franchise agreement is adapted to comply with local regulations, and certain franchisee obligations may be waived or deemed unenforceable based on state-specific laws.
In Maryland, the FDD states that no provision of the Disclosure Document or Franchise Agreement will be construed as a release, estoppel, or waiver by you of any liability we incur under the Maryland Franchise Registration and Disclosure Law. Similarly, in New York, the FDD states that all rights you enjoy and any causes of action arising in your favor from the provisions of Article 33 of the General Business Law of the State of New York and the regulations issued thereunder shall remain in force; it being the intent of this proviso that the non-waiver provisions of General Business Law Sections 687.4 and 687.5 be satisfied.
For a prospective Cinnabon franchisee, this means that the enforceability and interpretation of specific clauses within the franchise agreement can differ significantly depending on the state in which the franchise is located. It would be prudent to consult with a legal professional to understand the specific waivers and legal protections applicable in their state. This ensures full awareness of their rights and obligations under the Cinnabon franchise agreement, taking into account any state-specific addenda or modifications.