Besides the standard transfer fee, what other costs are the transferor responsible for paying to Cicis?
Cicis Franchise · 2025 FDDAnswer from 2025 FDD Document
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- you must pay all amounts owed to us, our Affiliates, and third-party vendors and have submitted all required reports and statements under this Agreement and any Franchise Agreement with us;
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- you must pay or cause to be paid to us a Transfer fee in the amount of Seven Thousand Five Hundred Dollars ($7,500), plus such amount as is necessary to reimburse us for our reasonable out of pocket costs and expenses associated with the Transfer; and
Source: Item 23 — RECEIPTS (FDD pages 65–263)
What This Means (2025 FDD)
According to Cicis's 2025 Franchise Disclosure Document, a transferor is responsible for covering certain costs beyond the standard transfer fee. Specifically, the transferor must reimburse Cicis for reasonable out-of-pocket costs and expenses associated with the transfer. Additionally, the transferor must settle all outstanding debts owed to Cicis, its affiliates, and any third-party vendors before the transfer can be finalized. The transferor must also have submitted all required reports and statements under the Development Agreement and any Franchise Agreement with Cicis.
These conditions ensure that Cicis does not incur any financial losses or compliance issues due to the transfer. By requiring the transferor to cover these costs, Cicis maintains financial stability and operational integrity during the ownership transition. This requirement is typical in franchising, as franchisors need to protect their brand and system standards.
For a prospective Cicis franchisee looking to transfer their development rights, it's crucial to understand these potential costs. Accurately estimating these expenses is essential for financial planning and ensuring a smooth transfer process. Failure to meet these financial obligations could delay or even prevent the transfer from occurring. Therefore, a transferor should maintain meticulous financial records and communicate transparently with Cicis to avoid any surprises during the transfer process.
It is important to note that the FDD specifies that Cicis may condition its approval of a transfer in any manner it deems necessary and appropriate to protect the Cicis brand and its interests in the System and the Development Agreement. This means that Cicis has broad discretion to impose additional conditions or requirements on the transferor, which could potentially include further costs or obligations. Therefore, a prospective transferor should carefully review the Development Agreement and communicate with Cicis to fully understand all of the requirements and potential costs associated with the transfer.