What is the definition of 'Good Standing' for a Cicis franchisee?
Cicis Franchise · 2025 FDDAnswer from 2025 FDD Document
thereafter, the rate specified in Section 4.C of this Agreement.
-
- Termination; Lost Revenue Damages. Provided you and your affiliates have been in Good Standing from the Effective Date and remain so during the notice period specified below, you may, at any time prior to [insert date that is the 18-month anniversary of the Effective Date], and without cause, deliver (as defined in the Franchise Agreement) a written notice to us of your election to terminate the Franchise Agreement. Termination will be effective at the close of business on the 30th day following delivery of your written notice of termination, and you will thereafter be required to comply with all obligations under the Franchise Agreement that are either triggered by or that expressly or by implication survive termination (except the obligation to pay Lost Revenue Damages under Section 16.M of the Franchise Agreement).
-
- Definitions. As used in this Amendment, "Good Standing" means that you, your owners, and your affiliates (if any) are not in default of the Franchise Agreement or any other agreement with us or our affiliates; and that you, your owners, and your affiliates have substantially and timely complied with all of the terms and conditions of all such agreements, including the timely satisfaction of all monetary obligations owed to us or our affiliates.
-
- General Release. You, on behalf of yourself, and your respective current and former parents, affiliates, and subsidiaries, and the agents, spouses, heirs, principals, attorneys, owners, officers, directors, employees, representatives, predecessors, successors, and assigns of each (collectively, the
"Releasing Parties"), hereby absolutely and irrevocably release and discharge us, our parents, subsidiaries, and affiliates, and the current and former owners, officers, directors, employees, managers, agents, representatives, predecessors, successors, and assigns of each (collectively, the "Released Parties"), of and from any and all claims, obligations, debts, proceedings, demands, rights to terminate and rescind, liabilities, losses, damages, and causes of action of whatever kind or nature, whether known or unknown, vested or contingent, suspected or unsuspected, at law or in equity (collectively, "Claims"), which any of the Releasing Parties ever owned or held, now own or hold, or may in the future own or hold, which are based on actions, omissions, or occurrences occurring on or prior to the Effective Date of this Addendum, including, without limitation,
Source: Item 23 — RECEIPTS (FDD pages 65–263)
What This Means (2025 FDD)
According to the 2025 Cicis Franchise Disclosure Document, 'Good Standing' has slightly different definitions depending on the context. In one instance, it means that the franchisee, their owners, and affiliates are not in default of the Franchise Agreement or any other agreement with Cicis or its affiliates. It also requires that they have substantially and timely complied with all terms and conditions of these agreements, including the timely satisfaction of all monetary obligations owed to Cicis or its affiliates.
In the context of a Restaurant History addendum, 'Good Standing' means that the franchisee and their affiliates are in compliance with all material obligations under the Franchise Agreement and all other agreements between them and Cicis. Cicis retains sole discretion to determine whether particular obligations are 'material' for determining good standing, and their decision is final.
Similarly, within the Underperforming Incentive Program Addendum, 'Good Standing' for Cicis franchisees and their affiliates means compliance with all material obligations under the Development Agreement, all Franchise Agreements (whether or not executed pursuant to the Development Agreement), and all other agreements between Cicis and the franchisee or their affiliates. Again, Cicis maintains sole discretion to determine which obligations are 'material,' and their decision is final.
For a prospective Cicis franchisee, maintaining 'Good Standing' is crucial, as failure to do so can result in the revocation of certain benefits, such as a reduction of the initial franchise fee or waivers of other fees. Because Cicis has the sole discretion to determine what constitutes a 'material' obligation, franchisees should ensure strict compliance with all agreements to avoid any potential disputes.