Must the third party who receives the Cicis franchise interest after death or disability be approved by Cicis?
Cicis Franchise · 2025 FDDAnswer from 2025 FDD Document
rminations will be binding. Each party will bear its own legal and other costs associated with the appraisal and will split the appraisal fees. If we exercise our right of first refusal herein provided, then we will have the right to set off against any payment (i) all fees for any such independent appraiser due from you hereunder; and (ii) all amounts due from you, your affiliates, and your or their owners to us or any of our affiliates.
D. Death or Permanent Disability.
(1) In case of your or your Managing Owner's death, your or their interests, as applicable, in you, this Agreement and your Restaurant must be transferred to a third party we approve within 12 months after the date of death or permanent disability. If you or, as applicable, your Managing Owner should become permanently disabled, we may, in our sole discretion, require such interests to be transferred to a third party in accordance with the conditions described in this Section 13.D within six (6) months after notice to you. "Permanent disability" means any physical, emotional, or mental injury, illness, or incapacity which would prevent a person from performing the obligations set forth in this Agreement or in the guaranty made part of this Agreement for at least 90 consecutive days and from which condition recovery within 90 days from the date of determination of disability is unlikely. Permanent disability will be determined by a licensed practicing physician we select (and at our costs), upon examination of the person;
Source: Item 22 — CONTRACTS (FDD pages 64–65)
What This Means (2025 FDD)
According to Cicis's 2025 Franchise Disclosure Document, if a franchisee or their Managing Owner dies or becomes permanently disabled, the interests in the Cicis franchise must be transferred to a third party approved by Cicis within 12 months of the death or disability. If the franchisee or Managing Owner becomes permanently disabled, Cicis has the discretion to require the interests to be transferred to a Cicis-approved third party within six months after notifying the franchisee.
"Permanent disability" is defined as a physical, emotional, or mental condition preventing the person from fulfilling their obligations under the Franchise Agreement or guaranty for at least 90 consecutive days, with recovery within 90 days being unlikely. Cicis will select and pay for a licensed physician to determine permanent disability through an examination. Refusal to submit to an examination results in automatic classification as permanently disabled.
The franchisee or their representative must promptly notify Cicis in writing of the death or permanent disability of the franchisee or Managing Owner. This notification triggers certain obligations and options for both the franchisee's estate and Cicis, including the potential for Cicis to purchase the franchise interest. Any transfer due to death or permanent disability is subject to the same terms and conditions as any other transfer during the franchisee's life.
This requirement ensures that Cicis maintains control over who operates its franchises, even in unforeseen circumstances like death or disability. Prospective franchisees should understand that their heirs or representatives will need to find a buyer acceptable to Cicis, or Cicis may exercise its option to purchase the franchise itself.