What is the duration of the Assessment Period for a Cicis franchise after the restaurant reopens?
Cicis Franchise · 2025 FDDAnswer from 2025 FDD Document
You and we agree that you will have a one-time right to permanently close the Restaurant if, for the period beginning on the date the Restaurant reopens for regular business and ending on the day that is 1.5 years after that date (the "Assessment Period"), the Restaurant's EBITDA (earnings before interest, taxes, depreciation and amortization), considering only those expenses that are normal restaurant-level operating expenses, is a negative number. To exercise the right to close, you must provide us, no sooner than the end of the Assessment Period and no later than 30 days after the end of the Assessment Period, (a) a profit and loss statement for the Assessment Period, which may be internally prepared in accordance with generally accepted accounting principles, showing the negative EBITDA, and (b) written notice of your intention to close and the date on which you intend to do so. On or prior to the closure, you and we will execute a written mutual termination of the Franchise Agreement, which will include a general release of any and all claims you and your related parties might have against us and our related parties, standard confidentiality and non-disparagement provisions, and your
Source: Item 23 — RECEIPTS (FDD pages 65–263)
What This Means (2025 FDD)
According to Cicis's 2025 Franchise Disclosure Document, a franchisee has a one-time right to permanently close their restaurant if its financial performance is not satisfactory. This right is evaluated over a specific timeframe called the Assessment Period. The Assessment Period begins on the date the Cicis restaurant reopens for regular business and extends for 1.5 years (18 months) after that date.
During this Assessment Period, the franchisee must monitor the restaurant's EBITDA (earnings before interest, taxes, depreciation, and amortization). Only normal restaurant-level operating expenses are considered when calculating EBITDA for this purpose. If the restaurant's EBITDA is negative at the end of the Assessment Period, the franchisee can exercise their right to close the restaurant.
To exercise this right, the franchisee must provide Cicis with a profit and loss statement for the Assessment Period, showing the negative EBITDA. This statement can be internally prepared following generally accepted accounting principles. The franchisee must also provide written notice of their intention to close the restaurant and the intended closure date. This notification must be given no sooner than the end of the Assessment Period and no later than 30 days after the Assessment Period concludes. Upon closure, a mutual termination agreement will be executed, including releases of claims, confidentiality, non-disparagement provisions, and continued compliance with certain obligations.