Under the Cicis Area Development Agreement, what actions constitute a 'transfer' by the franchisee?
Cicis Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in Franchise or other Agreement | Summary |
|---|---|---|
| Area Development Agreement – Section 6.B. | If you (or any of your owners, as applicable) (i) have made or make any material misrepresentation or omission in the application materials; (ii) you fail to comply with the Development Schedule; (iii) make or attempt to make an unpermitted transfer; (iv) fail to comply with 3 or more of your or their obligations during any 12 consecutive month period or on 2 or more separate occasions within any 6 consecutive month period fail to comply with the same obligation under the Area Development Agreement; (v) become insolvent; (vi) fail to comply with anti-terrorism laws, ordinances, regulations and Executive Orders; (vii) fail to comply with any other provision of this Agreement and do not correct the failure within 30 days after we deliver written notice of the failure to you; (viii) or an affiliate fails to comply with any other agreement with us or our affiliate, including any Franchise Agreement, unless the failure is timely and completely cured within any cure period provided under the applicable agreement); or (ix) you (or any of your owners) engage in any conduct which, in our opinion, adversely affects the reputation of Cicis Restaurants or the goodwill associated with the Marks. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 45–53)
What This Means (2025 FDD)
According to the 2025 Cicis Franchise Disclosure Document, making or attempting to make an unpermitted transfer under the Area Development Agreement can result in a default. Specifically, Section 6.B of the Area Development Agreement states that if a franchisee attempts to make an unpermitted transfer, it constitutes grounds for default if not corrected within 30 days after written notice from Cicis.
This means that any action by the franchisee to transfer rights or obligations under the Area Development Agreement without Cicis's permission is considered a breach of the agreement. This could include selling the development rights to another party, assigning the agreement to a different entity, or any other action that effectively transfers control or responsibility for developing Cicis restaurants in the designated area.
Prospective Cicis franchisees should carefully review the Area Development Agreement to understand what constitutes a permitted transfer and the procedures for obtaining Cicis's consent. Failure to comply with these requirements could result in termination of the agreement and loss of the development rights.