If Cicis assumes interim management of a restaurant after the franchisee's death or disability, does the franchise agreement specify that Cicis will not be liable for any debts, losses, costs, or expenses incurred during that period?
Cicis Franchise · 2025 FDDAnswer from 2025 FDD Document
We may (but are not obligated to) assume such interim management of your Restaurant; provided that (i) our interim management of your Restaurant will not relieve you of your obligations under this Agreement; (ii) we will not be liable for any debts, losses, costs, or expenses incurred in the operation of your Restaurant during any such period of interim management; (iii) we will have the right to charge a reasonable fee for our management services, plus the direct out-of-pocket costs and expenses incurred in the operation of the Restaurant; and (iv) you will, and hereby do, indemnify and hold us harmless against any and all judgments, fines, losses, liabilities, costs, amounts paid in settlement, and reasonable expenses (including, but not limited to attorneys' fees) incurred in connection with our interim management of your Restaurant, except by reason of our gross negligence or willful misconduct.
Source: Item 22 — CONTRACTS (FDD pages 64–65)
What This Means (2025 FDD)
According to Cicis's 2025 Franchise Disclosure Document, the franchise agreement addresses the scenario where Cicis assumes interim management of a restaurant following the death or permanent disability of the franchisee or managing owner. The agreement states that while Cicis has the option to assume interim management, it is not obligated to do so.
If Cicis does take over interim management, the franchise agreement specifies several conditions. Critically, Cicis will not be liable for any debts, losses, costs, or expenses that arise from the restaurant's operation during this interim period. However, the original franchisee remains responsible for their obligations under the franchise agreement.
Furthermore, Cicis is entitled to charge a reasonable fee for its management services, in addition to covering the direct out-of-pocket costs and expenses incurred while running the restaurant. The agreement also includes an indemnification clause, where the franchisee (or their estate) must protect Cicis from any judgments, fines, losses, liabilities, costs, settlement payments, and reasonable expenses, including attorney's fees, related to the interim management. This indemnification does not apply if the issues arise due to Cicis's gross negligence or willful misconduct.