What are the Cinnabon franchisee's obligations regarding the use of the franchisor's trademarks (Item 9) and how does this relate to the franchisor's ownership of the trademarks (Item 1)?
Cinnabon Franchise · 2025 FDDAnswer from 2025 FDD Document
A. We and our affiliates have developed and own, and will continue to develop, a distinctive business format and set of specifications and operating procedures (collectively, the "System") relating to the development, establishment, and operation of food-related businesses offering the approved products specified in Schedule A (the "Approved Products") under the primary trademark or service mark specified in Schedule A (the "Primary Mark").
B. Section 1.1 (Grant of Franchise) is amended to add the following sentence:
Subject to the terms of this Agreement, we grant to you, and you accept, a nonexclusive license to operate one Swirl Business using the Marks and the System (collectively, your "Franchised Business"). The Franchised Business will be operated only at the location specified in Schedule A (the "Accepted Location") or, if we have not yet accepted a site for the Franchised Business as of the date of this Agreement, at a location that we have accepted in accordance with this Agreement within the geographic area specified in Schedule A (the "Site Selection Area"). The Franchised Business must be operated at the Accepted Location in conjunction with a Carvel® franchised business (the "Co-Branded Franchise") that is operated by you in accordance with a Carvel® franchise agreement (the Co-Branded Agreement") between you and Carvel Franchisor SPV LLC (the "Co-Branded Franchisor"). The Franchised Business and the Co-Branded Franchise shall be co-branded using the Marks and the trademarks licensed to you by the Co-Branded Franchisor and shall be primarily identified by the CINNABON SWIRL™ Mark and trade dress.
You may also compete with the distribution and sale of Cinnabon® branded products through other outlets and sales channels. We may sell, or license affiliates or third parties to sell, Cinnabon® branded products (including products that you are likely to sell in your Bakery) (i) at wholesale to restaurants and retail stores (including grocery stores, convenience stores, club stores, and other outlets) that may be located anywhere, (ii) through non-traditional outlets, (iii) through mail order and Internet sales, (iv) through ghost or delivery kitchens, or (v) through other company-owned or franchised Bakeries. You will not be entitled to additional rights or compensation in any of these cases. See Item 12 for details regarding our reserved rights.
What This Means (2025 FDD)
Based on the 2025 Cinnabon Franchise Disclosure Document, Cinnabon Franchisor SPV LLC owns and has developed a distinctive business format and System related to food businesses offering approved products under the primary trademark. As the franchisor, Cinnabon grants the franchisee a nonexclusive license to operate one Swirl Business using the Marks and the System. The franchised business must be operated only at the accepted location. If a site has not been accepted, it must be at a location accepted in accordance with the Franchise Agreement within the specified geographic area. The franchised business must be operated in conjunction with a Carvel franchised business under a Carvel franchise agreement. The franchised business and the Carvel Franchise should be co-branded using the Marks and trademarks licensed and primarily identified by the CINNABON SWIRL™ Mark and trade dress.
Cinnabon retains the right to sell Cinnabon branded products through other outlets and sales channels. This includes wholesale to restaurants and retail stores, non-traditional outlets, mail order and Internet sales, ghost or delivery kitchens, or through other company-owned or franchised Bakeries. The franchisee is not entitled to additional rights or compensation in any of these cases.
Therefore, a Cinnabon franchisee must adhere to Cinnabon's standards and guidelines when using the trademarks and operating their franchise. They must also acknowledge Cinnabon's ownership and right to use the trademarks in other channels. This ensures brand consistency and protects the value of the Cinnabon brand, but it also means franchisees have limited control over how the brand is used outside of their specific franchise location.