What advance notice is required from City Publications if they intend not to renew a franchise in Michigan?
City_Publications Franchise · 2025 FDDAnswer from 2025 FDD Document
- ◼ A provision that permits a Franchisor to refuse to renew a franchise without fairly compensating the Franchisee by repurchase or other means for the fair market value at the time of expiration of the Franchisee's inventory, supplies, equipment, fixtures and furnishings. Personalized
materials which have no value to the Franchisor and inventory, supplies, equipment, fixtures and furnishings not reasonably required in the conduct of the franchise business are not subject to compensation. This subsection applies only if: (a) the term of the franchise is less than 5 years, and (b) the Franchisee is prohibited by the franchise or other agreement from continuing to conduct substantially the same business under another trademark, service mark, trade name, logotype, advertising or other commercial symbol in the same area subsequent to the expiration of the franchise or the Franchisee does not receive at least 6 months advance notice of Franchisor's intent not to renew the franchise.
Source: Item 23 — RECEIPT (FDD pages 39–129)
What This Means (2025 FDD)
According to City Publications' 2025 Franchise Disclosure Document, Michigan franchisees are entitled to compensation if City Publications chooses not to renew their franchise agreement under specific conditions. One of these conditions involves advance notice.
Specifically, if the franchise term is less than five years, and the franchisee is restricted from operating a similar business in the same area after the franchise expires, or if the franchisee does not receive at least six months' advance notice of City Publications' intent not to renew, then City Publications must fairly compensate the franchisee. This compensation covers the fair market value of the franchisee's inventory, supplies, equipment, fixtures, and furnishings at the time of expiration.
However, this compensation does not extend to personalized materials that hold no value for City Publications, or to inventory, supplies, equipment, fixtures, and furnishings not reasonably required for the franchise business. This provision ensures that franchisees in Michigan receive either sufficient notice to prepare for non-renewal or are compensated for their assets if such notice is not provided, offering some financial protection.