Is a terminating Cicis franchisee obligated to pay Lost Revenue Damages?
Cicis Franchise · 2025 FDDAnswer from 2025 FDD Document
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- Termination; Lost Revenue Damages. Provided you and your affiliates have been in Good Standing from the Effective Date and remain so during the notice period specified below, you may, at any time prior to [insert date that is the 18-month anniversary of the Effective Date], and without cause, deliver (as defined in the Franchise Agreement) a written notice to us of your election to terminate the Franchise Agreement. Termination will be effective at the close of business on the 30th day following delivery of your written notice of termination, and you will thereafter be required to comply with all obligations under the Franchise Agreement that are either triggered by or that expressly or by implication survive termination (except the obligation to pay Lost Revenue Damages under Section 16.M of the Franchise Agreement).
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- Definitions. As used in this Amendment, "Good Standing" means that you, your owners, and your affiliates (if any) are not in default of the Franchise Agreement or any other agreement with us or our affiliates; and that you, your owners, and your affiliates have substantially and timely complied with all of the terms and conditions of all such agreements, including the timely satisfaction of all monetary obligations owed to us or our affiliates.
Source: Item 23 — RECEIPTS (FDD pages 65–263)
What This Means (2025 FDD)
According to Cicis's 2025 Franchise Disclosure Document, under specific conditions, a franchisee may terminate the Franchise Agreement without being obligated to pay Lost Revenue Damages. If the franchisee and their affiliates have maintained Good Standing from the Effective Date and continue to do so during the notice period, they can terminate the agreement by providing written notice before the 18-month anniversary of the Effective Date.
Termination becomes effective 30 days after the notice is delivered. After termination, the franchisee must still comply with all obligations that are triggered by or survive the termination, except for the obligation to pay Lost Revenue Damages as outlined in Section 16.M of the Franchise Agreement.
Good Standing is defined as the franchisee, their owners, and affiliates not being in default of the Franchise Agreement or any other agreement with Cicis or its affiliates. It also requires substantial and timely compliance with all terms and conditions of these agreements, including the timely satisfaction of all monetary obligations.