In the event of death or permanent disability of a Cicis franchisee or managing owner, how long do the interests in the agreement and restaurant have to be transferred to a third party?
Cicis Franchise · 2025 FDDAnswer from 2025 FDD Document
(1) In case of your or your Managing Owner's death, your or their interests, as applicable, in you, this Agreement and your Restaurant must be transferred to a third party we approve within 12 months after the date of death or permanent disability. If you or, as applicable, your Managing Owner should become permanently disabled, we may, in our sole discretion, require such interests to be transferred to a third party in accordance with the conditions described in this Section 13.D within six (6) months after notice to you. "Permanent disability" means any physical, emotional, or mental injury, illness, or incapacity which would prevent a person from performing the obligations set forth in this Agreement or in the guaranty made part of this Agreement for at least 90 consecutive days and from which condition recovery within 90 days from the date of determination of disability is unlikely. Permanent disability will be determined by a licensed practicing physician we select (and at our costs), upon examination of the person; or if the person
refuses to submit to an examination, then such person automatically will be deemed permanently disabled as of the date of such refusal for the purpose of this Section 13.D.
Source: Item 22 — CONTRACTS (FDD pages 64–65)
What This Means (2025 FDD)
According to Cicis's 2025 Franchise Disclosure Document, in the event of the death or permanent disability of a franchisee or their managing owner, the interests in the franchise, the agreement, and the restaurant must be transferred to a Cicis-approved third party within 12 months of the date of death or permanent disability. If the franchisee or managing owner becomes permanently disabled, Cicis has the discretion to require the interests to be transferred within six months after providing notice to the franchisee.
The FDD defines "permanent disability" as a physical, emotional, or mental condition preventing the person from fulfilling their obligations under the agreement or guaranty for at least 90 consecutive days, with recovery within 90 days being unlikely. Cicis will select a licensed physician to determine permanent disability, and the franchisee must comply with the examination. Refusal to submit to an examination automatically deems the person permanently disabled.
It is important to note that the franchisee or their representative must promptly notify Cicis in writing of the death or permanent disability. Following notification, Cicis has the option to purchase the franchisee's or managing owner's interest in the agreement, restaurant, or the franchisee entity itself within 20 days of receiving notice. This transfer is subject to the same terms and conditions as any other transfer during the franchisee's lifetime.