What is the purchase price for the Interests in the Cicis franchise during the Option Period?
Cicis Franchise · 2025 FDDAnswer from 2025 FDD Document
(3) Anything contained in this Section 13.D to the contrary notwithstanding, upon your or your Managing Owner's death or permanent disability, we (or our designee) will have the option, to be exercised in writing within 20 days from the date we receive notice of the death or permanent disability pursuant to Section 13.D.(2) ("Option Period"), to elect to purchase your interest and/or the Managing Owner's interest in this Agreement, your Restaurant, or you, as applicable, as well as the further option to elect to purchase the interest of any other of your Owners (individually, "Interest" and collectively, "Interests") at the price and upon the terms set forth below.
(a) During the Option Period, the purchase price for the Interests will be determined with reference to the agreed value of your Restaurant ("Agreed Value"), as set forth below.
If you are a natural person, then the Agreed Value will be an amount equal to 100% of the Agreed Value.
If you are a legal entity, then the purchase price for any Interest will be an amount which bears the same relationship to the Agreed Value as the interest of the Person whose interests are being purchased bears to the total ownership interests in you.
- (b) The Agreed Value will be an amount equal to the Initial Value (defined below), less the total current and long-term liabilities we or our designee assume.
The Initial Value will be equal to the following (the "Initial Value"):
- (i) If the triggering death or permanent disability occurs prior to six (6) months following the Opening Date of your Restaurant, then the Initial Value will be an amount equal to your Original Cost (defined below), plus 10%.
Source: Item 22 — CONTRACTS (FDD pages 64–65)
What This Means (2025 FDD)
According to Cicis's 2025 Franchise Disclosure Document, the purchase price for the Interests during the Option Period depends on whether the franchisee is a natural person or a legal entity. The Option Period is triggered by the death or permanent disability of the franchisee or the Managing Owner. Cicis has 20 days from the date they receive notice of the death or permanent disability to exercise their option to purchase the Interests.
If the franchisee is a natural person, the purchase price will be 100% of the Agreed Value of the restaurant. If the franchisee is a legal entity, the purchase price for any Interest will be proportional to the interest of the person whose interests are being purchased relative to the total ownership interests in the entity. The Agreed Value is the Initial Value less any current and long-term liabilities that Cicis or its designee assumes.
The Initial Value is determined based on when the triggering event (death or permanent disability) occurs relative to the restaurant's Opening Date. If the event occurs within six months of the Opening Date, the Initial Value is the Original Cost plus 10%.