If a Franchise Agreement is signed pursuant to an Area Development Agreement, how does Cicis apply the development fee toward the initial franchise fees?
Cicis Franchise · 2025 FDDAnswer from 2025 FDD Document
etween you and the supplier.
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- If a Franchise Agreement is signed pursuant to an Area Development Agreement, we will apply the development fee, in increments of $15,000 ($10,000 if you participate in the Development Incentive Program), toward the payment of initial franchise fees. Your initial
franchise fee will be reduced to (i) $5,000 under the Franchise Agreements executed pursuant to the Reopen Incentive Program; (ii) $10,000 under the Franchise Agreements executed pursuant to the Development Incentive Program; and (iii) $0 under the Franchise Agreements executed pursuant to the Veteran's Incentive Program.
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- Cicis Restaurants are typically located in commercially zoned shopping areas. Due to the cost of land acquisition and new construction, the premises are normally leased. These amounts assume that you will lease the premises for the Location and do not include costs of land acquisition and construction of a building. If you purchase land and construct the Location, the initial cost will be significantly greater than these estimates. Due to the highly variable nature of these costs, we cannot provide an estimate of the cost to acquire land and construct a new building. The estimates provided are based on the cost of adapting our prototypical architectural plans for the finish-out of a Cicis Buffet Restaurant containing approximately 3,000 to 6,000 square feet and a Cicis To Go Restaurant containing approximately 1,000 to 1,500 square feet. The leasehold improvement ranges will be affected by various factors like the location of the Cicis Restaurant and local market conditions. The estimates assume that the landlord will provide connections to adequate electrical, gas, water, and sewage service. Your actual costs may or may not include site preparation, demising walls, and utility extensions, depending on the arrangements you negotiate with your landlord.
Source: Item 7 — ESTIMATED INITIAL INVESTMENT YOUR ESTIMATED INITIAL INVESTMENT FOR A CICIS BUFFET RESTAURANT (FDD pages 21–25)
What This Means (2025 FDD)
According to Cicis's 2025 Franchise Disclosure Document, when a Franchise Agreement is signed as part of an Area Development Agreement, the development fee is applied towards the initial franchise fees. For a typical opening commitment of 2 or 3 Cicis restaurants, the development fee is $15,000 multiplied by the number of restaurants the franchisee agrees to open. This fee is then applied in increments of $15,000 toward the initial franchise fees as each Franchise Agreement is executed.
However, under the Development Incentive Program, if a franchisee enters into a new 5-unit Area Development Agreement and remains in good standing, the development fee is $10,000 multiplied by the number of Cicis restaurants they agree to open. In this case, the development fee is applied in increments of $10,000 toward the initial franchise fees as Franchise Agreements are executed.
It's important to note that for each restaurant developed under an Area Development Agreement, the franchisee must execute an individual Franchise Agreement and incur the associated costs. The initial franchise fee will be reduced to $5,000 under the Franchise Agreements executed pursuant to the Reopen Incentive Program, $10,000 under the Franchise Agreements executed pursuant to the Development Incentive Program, and $0 under the Franchise Agreements executed pursuant to the Veteran's Incentive Program.