What are my obligations regarding confidential Cinnaholic materials during and after the term of the Franchise Agreement and Development Agreement?
Cinnaholic Franchise · 2025 FDDAnswer from 2025 FDD Document
r information we create or use. We have not registered any of these copyrighted materials with the United States Registrar of Copyrights, although we may do so. We also treat all of this information as trade secrets.
All materials or information of any kind that are designated "confidential" orally or in writing or which, under the circumstances surrounding disclosure, ought to be treated as confidential, are deemed confidential and are loaned to you only under and during the term of the Franchise Agreement and Development Agreement. All confidential materials and the information contained in them must be treated by you as confidential and you must use your best efforts to keep them confidential during and after the terms of the Franchise Agreement and Development Agreement as provided in each agreement. This means that you cannot make copies in any medium of any confidential information or use any confidential information outside of the scope of the Franchise Agreement or Development Agreement or disclose any confidential information to any third party or other persons identified by us as not having authorization to receive disclosure of confidential information. You may disclose confidential information contained in the Operations Manual only to your employees who have a business need to have access to the confidential information, but only if you first secure from them an agreement to maintain the confidentiality of the confidential information disclosed.
All copyrighted materials and confidential information are owned exclusively by us. Your right to use copyrighted materials and confidential information is derived solely from the Franchise Agreement and Development Agreement and is limited to the conduct of the business under and in compliance with the Franchise Agreement and Development Agreement and all applicable specifications, standards, and operating procedures we prescribe during the term of the Franchise Agreement and Development Agreement. Any unauthorized use of our copyrighted materials or any unauthorized use or disclosure of confidential information will constitute an infringement of our rights in and to the copyrighted materials and confidential information.
We may claim copyright protection in certain techniques we create, and may patent certain processes and equipment we develop. If we do, we will notify you and, if the copyrights and patents are material to your obligations under the Franchise Agreement, we will authorize you to use them at no additional charge. Any modifications or improvements that you make to the CINNAHOLIC® franchise system will be deemed a works made for hire which shall be owned exclusively by us. We do not have to compensate you for your modification or improvement.
You must promptly notify us of any unauthorized use of our copyrighted materials or any unauthorized use or disclosure of confidential information, including by your employees. You must notify us of any challenge to your right to use or the ownership of any copyrighted materials or confidential information.
Source: Item 14 — PATENTS, COPYRIGHTS, AND PROPRIETARY INFORMATION (FDD pages 39–40)
What This Means (2025 FDD)
According to Cinnaholic's 2025 Franchise Disclosure Document, franchisees have strict obligations regarding confidential materials, both during and after the terms of the Franchise Agreement and Development Agreement. All materials designated as "confidential" either orally or in writing, or which should reasonably be considered confidential, are loaned to the franchisee only for the duration of these agreements. Franchisees must treat these materials as confidential and use their best efforts to maintain confidentiality both during and after the agreement terms. This encompasses a broad range of information, including the Operations Manual, marketing materials, specifications, architectural drawings, bakery designs, marketing techniques, advertising programs, advertising strategies, supplier lists, and expansion plans.
The obligations include preventing unauthorized copying, use, or disclosure of confidential information. Franchisees can only disclose confidential information from the Operations Manual to employees with a business need to know, and only after securing an agreement from those employees to maintain confidentiality. Cinnaholic retains exclusive ownership of all copyrighted materials and confidential information, and the franchisee's right to use them is solely derived from, and limited by, the Franchise and Development Agreements.
Franchisees must promptly report any unauthorized use or disclosure of confidential information, including by their employees, and any challenges to Cinnaholic's ownership or the franchisee's right to use the materials. Cinnaholic has the right to modify its copyrighted materials, including the Operations Manual, and franchisees must adopt these changes at their own expense. Spouses, shareholders, members, partners, and managers must also sign agreements to comply with confidentiality provisions. Unauthorized use of confidential information or trade secrets can lead to legal action against the franchisee.
These stipulations are typical in franchising, as franchisors need to protect their intellectual property and maintain consistency across the franchise system. Prospective Cinnaholic franchisees should carefully review the definitions of "confidential information" in the Franchise and Development Agreements to fully understand the scope of these obligations. They should also establish clear procedures for handling confidential information within their business to prevent breaches and ensure compliance.