According to the Cicis Franchise Agreement, what constitutes a 'controlling interest'?

According to Cicis's 2025 Franchise Disclosure Document, a 'controlling interest' is defined as the direct or indirect power to direct the franchisee's management and policies. This includes policies related to the payment of financial obligations. This power can be exerted through various means, such as ownership of voting securities or interests, contractual agreements, or other arrangements, as reasonably determined by Cicis.

For a prospective Cicis franchisee, this definition is crucial because it clarifies the extent of control Cicis can exert over the franchisee's business operations. It's not solely about owning a majority stake; control can be established through agreements or other means that give Cicis the power to dictate management and financial decisions.

This definition allows Cicis broad discretion in determining what constitutes control. Franchisees should be aware that Cicis can deem various arrangements as giving them a controlling interest, impacting the franchisee's autonomy. Therefore, franchisees should seek legal counsel to fully understand the implications of this clause and how it might affect their ability to manage their business independently.

Understanding this definition is essential for any potential Cicis franchisee to assess the level of independence they will have in running their restaurant and to anticipate potential areas of franchisor oversight.