What adjustments were made to the data set to account for franchisees with older Cicis Franchise Agreements?

According to Cicis's 2025 Franchise Disclosure Document, adjustments were made to the data set to account for franchisees operating under older franchise agreements. Some franchisees in the data set are subject to older agreements that stipulate lower payment amounts than the current franchise agreement. To address these discrepancies, Cicis made adjustments to bring these franchisees in line with the royalty, technology, and support fee requirements of the current franchise agreement.

Specifically, the adjustments include the 'Royalty Adjustment,' which is the difference between the average royalty paid by franchisees in the data set and the 5% royalty required under the current agreement. There is also a 'Technology and Support Fee' adjustment, representing the difference between the average amount paid by franchisees in the data set for the Technology and Support Fee and the $100 per month required under the current agreement. Additionally, there's an 'Advertising National Adjustment,' which accounts for the difference between the average contributions to the Brand Fund and the 5% of Net Sales required by the current agreement.

These adjustments are incorporated into the calculation of 'Adjusted EBITDA,' which is defined as 'Restaurant EBITDA After' minus the Royalty Adjustment, Technology and Support Fee Adjustment, and the Advertising National Adjustment. By making these adjustments, Cicis aims to provide a more standardized and relevant financial performance representation for prospective franchisees, reflecting the financial obligations under the current franchise agreement. This allows potential franchisees to better understand the financial expectations and obligations they will face when operating a Cicis restaurant under the current agreement.