What is the term length of the new franchise agreement that the transferee of a Cicis franchise must execute?
Cicis Franchise · 2025 FDDAnswer from 2025 FDD Document
- (e) the transferee must execute, for a term ending on the expiration date of this Agreement and with such renewal terms as may be provided by this Agreement, our thencurrent standard form of franchise agreement and all other ancillary agreements as we may require, which agreements will supersede this Agreement and its ancillary documents in all respects and the terms of which agreements may differ from the terms of this Agreement, including a higher percentage Royalty Fee and Fund Contribution or expenditure requirement; provided, however, that the transferee will not be required to pay any initial franchise fee; and, if the transferee is legal entity, such of transferee's owners as we may designate must execute such agreement and jointly assume and guarantee the entity's performance of all such obligations, covenants, and agreements;
Source: Item 22 — CONTRACTS (FDD pages 64–65)
What This Means (2025 FDD)
According to Cicis's 2025 Franchise Disclosure Document, a transferee of an existing franchise must execute Cicis's then-current standard form of franchise agreement. The term of this new agreement will end on the expiration date of the original agreement, including any renewal terms provided by the original agreement.
This means that the transferee essentially steps into the shoes of the original franchisee for the remainder of the franchise term. The new agreement supersedes the original one in all respects, and its terms may differ, potentially including higher royalty fees or fund contribution requirements. However, the transferee is not required to pay an initial franchise fee.
This condition ensures that Cicis maintains a consistent franchise agreement across its system and that the transferee is bound by the current standards and requirements. It also allows Cicis to update the financial terms of the franchise agreement to reflect current market conditions. A prospective transferee should carefully review the then-current franchise agreement to understand their obligations and potential costs.