Under what conditions can a Cicis franchisee terminate the Franchise Agreement without cause under the Underperforming Incentive Program?
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, a franchisee participating in the Underperforming Incentive Program can terminate the Franchise Agreement without cause if they meet specific conditions. The franchisee and their affiliates must have been in "Good Standing" from the Effective Date of the addendum and continue to be in Good Standing during the notice period. Good Standing is defined as not being in default of the Franchise Agreement or any other agreement with Cicis or its affiliates, and having substantially and timely complied with all terms and conditions, including timely satisfaction of all monetary obligations.
To terminate without cause, the franchisee must deliver a written notice to Cicis before the date that is 18 months from the Effective Date of the addendum. The termination becomes effective 30 days after Cicis receives the written notice.
Upon termination, the franchisee must comply with all obligations under the Franchise Agreement that are triggered by or survive termination. However, the franchisee is not obligated to pay Lost Revenue Damages as outlined in Section 16.M of the Franchise Agreement. This provides a limited window and specific conditions under which a franchisee can exit the agreement without penalty, offering some flexibility if the franchise is not performing as expected.