What constitutes a failure to be in 'Good Standing' for a Cicis franchisee under the Underperforming Incentive Program?

According to Cicis's 2025 Franchise Disclosure Document, 'Good Standing' within the context of the Underperforming Incentive Program means that the franchisee and their affiliates are in compliance with all material obligations under the Development Agreement and all Franchise Agreements between Cicis and the franchisee or their affiliates, whether or not executed pursuant to the Development Agreement.

Cicis retains sole discretion to determine whether particular obligations are considered "material" for the purpose of determining good standing, and their decision is final. This gives Cicis significant control over the criteria for remaining in good standing and participating in the Underperforming Incentive Program.

For a prospective Cicis franchisee, this means that maintaining 'Good Standing' is crucial for continued participation in the program and to receive benefits such as waived or reduced fees. The franchisee must ensure compliance with all agreements, and should seek clarity from Cicis on what specific obligations are deemed 'material' to minimize the risk of losing the program's incentives. Since the determination of 'material' obligations is at Cicis's sole discretion, franchisees should maintain open communication and address any potential compliance issues promptly.