Under what condition are Cinnabon franchisees' initial fees and payments deferred?
Cinnabon Franchise · 2025 FDDAnswer from 2025 FDD Document
Based upon our financial condition, the Maryland Securities Commissioner has required a financial assurance. Therefore, all initial fees and payments owed by franchisees shall be deferred until we complete our pre-opening obligations under the Franchise Agreement. If a franchisee signs a Multi-Unit Addendum to a Franchise Agreement, all initial fees and payments owed by such franchisee under each of the Franchise Agreements that is subject to the Multi-Unit Addendum shall be deferred until we complete our pre-opening obligations under the applicable Franchise Agreement.
Source: Item 23 — Receipts (FDD pages 114–399)
What This Means (2025 FDD)
According to the 2025 Cinnabon Franchise Disclosure Document, in Maryland, the Maryland Securities Commissioner requires a financial assurance due to Cinnabon's financial condition. As a result, Cinnabon defers all initial fees and payments owed by franchisees in Maryland until it completes its pre-opening obligations under the Franchise Agreement.
If a Cinnabon franchisee in Maryland signs a Multi-Unit Addendum to a Franchise Agreement, all initial fees and payments owed by that franchisee under each of the Franchise Agreements subject to the Multi-Unit Addendum will also be deferred. This deferral lasts until Cinnabon completes its pre-opening obligations under the applicable Franchise Agreement.
This condition is specific to Maryland due to its franchise registration and disclosure laws and Cinnabon's financial condition as assessed by the Maryland Securities Commissioner. Prospective franchisees outside of Maryland should not expect this deferral.