Does City Publications allow the franchisee to designate how their payments are applied?
City_Publications Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee shall promptly pay all sums owing to Franchisor.
In the event of termination for any default of Franchisee, such sums shall include, but not be limited to, all damages, costs and expenses, including reasonable attorneys' fees and other expenses incurred by Franchisor as a result of the default.
Source: Item 23 — RECEIPT (FDD pages 39–129)
What This Means (2025 FDD)
Based on the 2025 City Publications Franchise Disclosure Document, the document does not explicitly state whether a franchisee can designate how their payments are applied across different fees or obligations. The FDD does outline various fees, such as the Royalty Fee, Advertising Fee, Mailing List Rental Fee, Technology and Training Fee, and Graphics Services Fee, and specifies what each fee covers. It also mentions that the franchisee must promptly pay all sums owing to the Franchisor. However, the FDD does not provide specific details on whether the franchisee has the option to allocate payments to particular fees or outstanding balances.
Without explicit guidance in the FDD, franchisees should clarify with City Publications the acceptable methods for payment allocation. Understanding the franchisor's policy on payment designation is crucial for maintaining a transparent financial relationship and avoiding potential disputes over outstanding balances or misapplied payments.
Prospective franchisees should directly inquire with City Publications about their policies regarding payment allocation. Specifically, they should ask if it is possible to designate payments towards specific fees (e.g., royalty, advertising, mailing list) and whether there are any restrictions or procedures for doing so. This information will help franchisees manage their financial obligations effectively and ensure compliance with the franchisor's requirements.