What is the process for the Cicis franchisee to exercise their one-time right to permanently close the Restaurant under the Reopen Incentive Program Addendum?

According to Cicis's 2025 Franchise Disclosure Document, specifically Exhibit D-3 Reopen Incentive Program Addendum, a franchisee has a one-time right to permanently close their restaurant under certain conditions. This right is available if the restaurant's EBITDA (earnings before interest, taxes, depreciation, and amortization) is a negative number during the Assessment Period. The Assessment Period begins when the restaurant reopens for regular business and ends 1.5 years after that date, considering only normal restaurant-level operating expenses.

To exercise this right, the franchisee must provide Cicis with specific documentation and notice within a limited timeframe. No sooner than the end of the Assessment Period and no later than 30 days after the end of the Assessment Period, the franchisee must submit (a) a profit and loss statement for the Assessment Period, which can be internally prepared following generally accepted accounting principles, showing the negative EBITDA, and (b) written notice of their intention to close the restaurant, including the intended closure date.

Prior to or on the closure date, both Cicis and the franchisee will execute a written mutual termination of the Franchise Agreement. This agreement will include a general release of any claims the franchisee and their related parties might have against Cicis and its related parties. It will also contain standard confidentiality and non-disparagement provisions, as well as the franchisee's and their owners' agreement to comply with the obligations under the Franchise Agreement that are triggered by or survive the termination of the agreement. This process ensures a structured and mutually agreed-upon exit strategy if the reopened restaurant underperforms significantly during the initial assessment period.