Under what circumstances can Cinnabon terminate the franchise agreement without providing an opportunity for the franchisee to cure the default?
Cinnabon Franchise · 2025 FDDAnswer from 2025 FDD Document
- 17.2 Our Termination: No Opportunity to Cure.
We have the right to terminate this Agreement without affording you any opportunity to cure the default, effective on our sending of notice of termination to you (or the earliest date permitted by applicable law) if:
- A.
You or your Owners violate the Personal Covenants or other restrictive covenants, including the restrictions related to the use of Confidential Information or Trade Secrets, in Section 15 (Confidential Information; Restrictive Covenants).
- R. Section 17.2 (Our Termination; No Opportunity to Cure) is amended by adding the following Section 17.2.M. and 17.2.N.:
- 17.2.M. If you operate an Express Bakery located in a Host Facility and you fail to comply with any of the terms of the franchise agreement for the Host Facility or your franchise agreement for the Host Facility is terminated or expires.
- 17.2.N. If you operate an Express Bakery located in a Host Facility and the Host Facility's brand deteriorates in quality or reputation such that, in our sole judgment, our association with the Host Facility's brand is damaging or may damage the Cinnabon brand or the Marks.
Source: Item 23 — Receipts (FDD pages 114–399)
What This Means (2025 FDD)
According to Cinnabon's 2025 Franchise Disclosure Document, Cinnabon has the right to terminate the franchise agreement without providing an opportunity to cure the default if certain conditions are met. These conditions include violations of personal covenants or other restrictive covenants, such as those related to the use of confidential information or trade secrets. This means that if a franchisee breaches the terms outlined in Section 15 regarding confidential information or restrictive covenants, Cinnabon can immediately terminate the agreement.
Additionally, for franchisees operating an Express Bakery located in a Host Facility, Cinnabon can terminate the agreement without an opportunity to cure if the franchisee fails to comply with any terms of the franchise agreement for the Host Facility, or if the Host Facility's franchise agreement is terminated or expires. Cinnabon can also terminate the agreement without opportunity to cure if the Host Facility's brand deteriorates in quality or reputation, such that Cinnabon's association with the Host Facility's brand is damaging or may damage the Cinnabon brand or the Marks.
These stipulations highlight the importance of adhering to all contractual obligations and maintaining brand integrity. For prospective franchisees, especially those considering an Express Bakery within a Host Facility, it is crucial to understand and comply with both the Cinnabon franchise agreement and the Host Facility's franchise agreement to avoid immediate termination without recourse.