According to the Cicis Area Development Agreement, what is the subject of Section 3?
Cicis Franchise · 2025 FDDAnswer from 2025 FDD Document
e securing possession of the Site, you or an Affiliate we approve must sign our then-current form of Franchise Agreement and related documents, the terms of which may differ substantially from the terms contained in the form of Franchise Agreement we are using to grant Franchises on the Effective Date, except that the Royalty rate will not exceed 5% of Gross Sales for Cicis Buffet Restaurants or 6% of Gross Sales for Cicis To Go Restaurants, and the Initial Franchise Fee will be $30,000 for Cicis Buffet Restaurant or $15,000 for Cicis To Go Restaurants. Each Franchise Agreement will govern the development and operation of the Restaurant at the accepted Site identified therein.
3. DEVELOPMENT FEE.
On your execution of this Agreement and in consideration of the grant of the Development Rights, you must pay us a nonrecurring, nonrefundable, and fully earned (on execution of this Agreement) development fee in an amount equal to $15,000 times the tota
Source: Item 23 — RECEIPTS (FDD pages 65–263)
What This Means (2025 FDD)
According to Cicis's 2025 Area Development Agreement, Section 3 pertains to the Development Fee. It states that upon execution of the agreement, the developer must pay Cicis a non-recurring, nonrefundable development fee. This fee is calculated by multiplying $15,000 by the total number of restaurants the developer is expected to develop under the agreement.
For each restaurant that the developer or their affiliates open, Cicis will credit $15,000 of the development fee towards the Initial Franchise Fee. The developer is then responsible for paying any remaining balance of the Initial Franchise Fee when they sign the Franchise Agreement for that specific restaurant.
The agreement clarifies that Cicis will not refund any portion of the Development Fee, nor will they apply any credit that exceeds the specified amounts or the total Development Fee. Cicis considers the Development Fee fully earned once both parties sign the Area Development Agreement.