Under what condition related to alcohol sales will Cicis and the franchisee enter into an amendment to the Franchise Agreement?

According to Cicis's 2025 Franchise Disclosure Document, if a franchisee serves alcohol and applicable laws prohibit or restrict the payment or collection of Royalty Fees or other amounts based on Net Sales derived from alcohol sales, Cicis and the franchisee will enter into an amendment to the Franchise Agreement. This amendment will modify the franchisee's payment obligations to ensure that both Cicis and the franchisee maintain the same basic economic effect as originally intended in the Franchise Agreement.

This condition ensures that Cicis receives its due compensation even when legal restrictions impact alcohol sales revenue. The amendment aims to find an alternative payment structure that mirrors the original agreement's financial outcome for both parties. This could involve adjusting royalty calculations based on other revenue streams or implementing a different fee structure that complies with local laws.

For a prospective Cicis franchisee, this means that if they plan to sell alcohol, they need to be aware of local regulations regarding royalty fees on alcohol sales. They should also be prepared to negotiate an amendment to the Franchise Agreement with Cicis to ensure compliance and maintain a fair economic balance. It is important for franchisees to understand these potential modifications to their payment obligations and how they might affect their overall profitability.