What is the basis for Cicis entering into the Franchise Agreement regarding the franchisee's liquidity?
Cicis Franchise · 2025 FDDAnswer from 2025 FDD Document
Pursuant to separate written agreements (each a "Franchise Agreement"), we grant franchises (each a "Franchise") for the right to develop and operate restaurants that are identified by and use "Cicis" and other designated trademarks and service marks (the "Marks"), and that offer pizza and other designated food and related items from a designated facility and using designated service methods (each a "Cicis Restaurant"). There are two types of Cicis Restaurants: (1) dine-in buffet restaurants ("Cicis Buffet Restaurants"), and (2) take-out/delivery only restaurants ("Cicis To Go Restaurants"). We also grant to persons or entities that we believe meet our qualifications, and are willing to commit, the right to acquire multiple Franchises ("Development Rights"). Based on your own investigation and diligence, you have applied to acquire Development Rights and, to support your application, you and, if applicable, your owners have provided us with certain information about your and their backgrounds, experience, skills, financial condition and resources (collectively, the "Application Materials"). In reliance on the Application Materials, among other things, we are willing to grant you the Development Rights on the terms and conditions, and subject to the limitations, described in this Agreement. Cicis Restaurants that you or your Affiliates shall develop pursuant to this Agreement are referred to as the "Restaurants."
Source: Item 23 — RECEIPTS (FDD pages 65–263)
What This Means (2025 FDD)
According to Cicis's 2025 Franchise Disclosure Document, Cicis is willing to grant Development Rights based on the franchisee's application. As part of the application, the prospective franchisee provides information regarding their background, experience, skills, financial condition, and resources. Cicis relies on this information, referred to as the "Application Materials," when deciding whether to grant Development Rights.
Specifically, Cicis reviews the Application Materials to assess whether the applicant meets their qualifications and demonstrates a willingness to commit to acquiring multiple franchises. This assessment includes evaluating the applicant's financial condition and resources to ensure they have the capacity to develop and operate multiple Cicis Restaurants. The willingness of Cicis to grant Development Rights is contingent upon the accuracy and completeness of the information provided in the Application Materials.
Therefore, a prospective Cicis franchisee should ensure that all information provided in the Application Materials is accurate and up-to-date. Misrepresenting or omitting key financial information could lead to the rejection of the application or, if discovered later, potential legal issues or termination of the agreement. Franchisees should be prepared to provide supporting documentation to verify the financial information provided in their application.