Can an affiliate's failure to comply with an agreement with Cicis lead to termination of the Development Agreement?

According to Cicis's 2025 Franchise Disclosure Document, the Development Agreement can be terminated if an affiliate fails to comply with any agreement with Cicis. Specifically, if you or an affiliate fails to comply with any agreement with Cicis or its affiliate, including any Franchise Agreement, Cicis can terminate the Development Agreement. However, this is contingent on the failure not being resolved within the cure period provided under the applicable agreement.

This provision means that a Cicis developer's entire development agreement is at risk if any affiliated entity violates its agreements with Cicis, even if those agreements are separate franchise agreements. This creates a significant risk for developers who may have multiple entities or partners operating Cicis restaurants, as the actions of one entity can jeopardize the entire development agreement.

It is important for prospective Cicis developers to carefully review all agreements and ensure that all affiliated entities are in full compliance to avoid potential termination of the Development Agreement. The cure period mentioned provides an opportunity to rectify the non-compliance, but it is crucial to act promptly and completely within that period to avoid termination.