Under what circumstances might a provision in the Cicis Area Development Agreement or Franchise Agreement be unenforceable in Virginia regarding the franchisor's option to purchase the franchisee's business?
Cicis Franchise · 2025 FDDAnswer from 2025 FDD Document
- The "Summary" section of Item 17(o), entitled "Franchisor's option to purchase franchisee's business" is amended by adding the following:
Pursuant to Section 13.1-564 of the Virginia Retail Franchising Act, it is unlawful for a franchisor to use undue influence to induce a franchisee to surrender any right given to him under the franchise. If any provision of the Area Development Agreement or Franchise Agreement involves the use of undue influence by the franchisor to induce a franchisee to surrender any rights given to him under the franchise, that provision may not be enforceable.
Source: Item 20 — OUTLETS AND FRANCHISEE INFORMATION (FDD pages 58–64)
What This Means (2025 FDD)
According to Cicis's 2025 Franchise Disclosure Document, a specific condition exists in Virginia that could render a provision within the Area Development Agreement or Franchise Agreement unenforceable, particularly concerning Cicis's option to purchase the franchisee's business.
Specifically, if any provision of the Area Development Agreement or Franchise Agreement involves Cicis using undue influence to pressure a franchisee into surrendering rights granted to them under the franchise, that specific provision may not be enforceable under Virginia law. This protection is provided under Section 13.1-564 of the Virginia Retail Franchising Act, which aims to prevent franchisors from exerting undue influence over franchisees.
This means that Cicis franchisees in Virginia have some protection against potentially overbearing tactics from the franchisor related to the sale of their business. Franchisees should seek legal counsel if they believe Cicis is using undue influence to force them to surrender their rights. This ensures franchisees are fully aware of their rights and can take appropriate action if they feel those rights are being violated.