What is the required action for a Cicis franchisee to maintain the reduced Initial Franchise Fee under the Development Incentive Program Addendum?
Cicis Franchise · 2025 FDDAnswer from 2025 FDD Document
upplement and amend that certain Franchise Agreement they have executed immediately prior to the execution of this Addendum (as it might have otherwise been amended, the "Franchise Agreement"). The Franchise Agreement was executed pursuant to a Development Agreement between us and you or your affiliate (the "Development Agreement"). The "Effective Date" of this Addendum is the same as the Effective Date of the Franchise Agreement. Capitalized terms used but not defined in this Addendum have the meanings given them in the Franchise Agreement. For valuable consideration, receipt and sufficiency of which are acknowledged, the Parties agree as follows:
- Reduction of Initial Franchise Fee. Section 4.A of the Franchise Agreement is supplemented and amended by adding the following to the end of the Section:
While you are approved to participate in the Program and provided you and your affiliates remain in good standing, we agree that the Initial Franchise Fee shall be reduced to $10,000. We rese
Source: Item 23 — RECEIPTS (FDD pages 65–263)
What This Means (2025 FDD)
According to Cicis's 2025 Franchise Disclosure Document, to maintain the reduced Initial Franchise Fee under the Development Incentive Program Addendum, a franchisee and their affiliates must remain in "good standing" while approved to participate in the Program. Good standing is defined as compliance with all material obligations under the Franchise Agreement, the Development Agreement (including the Development Schedule), and all other agreements between Cicis and the franchisee or their affiliates.
Cicis retains sole discretion to determine whether particular obligations are "material" for determining good standing, and their decision is final. If a franchisee is no longer approved to participate in the Program or ceases to be in good standing, Cicis reserves the right to revoke the reduction of the Initial Franchise Fee. In such cases, the franchisee will be required to pay the balance of the full Initial Franchise Fee as outlined in the Franchise Agreement, absent the reduction.
For a prospective Cicis franchisee, this means that maintaining eligibility for the reduced Initial Franchise Fee requires diligent adherence to all agreements with Cicis. Failure to meet obligations, particularly those deemed material by Cicis, could result in the loss of the reduced fee and a requirement to pay the remaining balance. This highlights the importance of understanding and complying with all terms of the Franchise Agreement, Development Agreement, and any other related agreements.