Does the City Publications franchise agreement prohibit the franchisee from performing services for a Competitive Business, and if so, in what capacity?
City_Publications Franchise · 2025 FDDAnswer from 2025 FDD Document
s, executives, and professional staff and managers and the spouses of each of the foregoing sign a like restrictive covenant which shall protect both Franchisor and Franchisee. Said covenants shall remain on file at the offices of Franchisee and are subject to audit or review as otherwise set forth herein.
A. Restriction During Term of Agreement
Franchisee covenants that, except as otherwise approved in writing by Franchisor, neither Franchisee nor any partner(s), officer(s), director(s), member(s), executives, professional staff or sales staff or the spouses of any of the foregoing shall, during the term hereof, either directly or indirectly, for itself or through, on behalf of or in conjunction with, any person, persons, partnership, corporation, limited liability company or other entity:
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- Own an interest in, manage, operate, be employed, in a sales or management capacity, by, or act as a consultant to any Competitive Business anywhere;
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- Initiate any action to hire, or attempt to hire for any other employer, any person who is employed by Franchisor or employed by any other franchisee of the CITY PUBLICATIONS System, or induce any such person to leave his employment with Franchisor or any other franchisee in order to work for any other employer, whether or not the person's employment with the business is pursuant to a written agreement or is at will; or
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- Divert business of customers of the Franchised Business or other Franchisor or franchisee-owned CITY PUBLICATIONS Businesses to any Competitive Business.
B. Restriction After Termination
Franchisee covenants that, except as otherwise approved in writing by Franchisor, neither Franchisee nor any partner(s), officer(s), director(s), member(s), executives, or professional staff or sales staff or their spouses of any of the foregoing shall for a period of two (2) years after the expiration or termination of this Agreement regardless of the cause, either directly or indirectly, for itself or through, on behalf of or in conjunction with, any person, persons, partnership, corporation, limited liability company or other entity:
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- Own an interest in, manage, operate, be employed, in a sales or management capacity, by, or act as a consultant to any Competitive Business anywhere within the Exclusive Territory granted to Franchisee, or within a radius of twenty-five (25) miles of any other Franchisor or franchisee-owned CITY PUBLICATIONS Business;
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- Initiate any action to hire, or attempt to hire for any other employer, any person who is employed by Franchisor or employed by any other franchisee of the CITY PUBLICATIONS System, or induce any such person to leave his employment with Franchisor or any other franchisee in order to work for any other employer, whether or not the person's employment with the business is pursuant to a written agreement or is at will; or
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- Solicit business from customers of Franchisee's former CITY PUBLICATIONS business or other Franchisor or franchisee-owned CITY PUBLICATIONS Businesses.
**C.
Source: Item 23 — RECEIPT (FDD pages 39–129)
What This Means (2025 FDD)
According to the 2025 City Publications Franchise Disclosure Document, the franchise agreement places restrictions on a franchisee's involvement with any Competitive Business during the term of the agreement. A "Competitive Business" is defined as any business that sells direct mail advertising or similar services to those offered as part of the City Publications system, or in which confidential information could be used to the disadvantage of City Publications or its other franchisees. This includes magazines, print ads, internet advertising, email advertising, QR codes, and search engine optimization services.
During the term of the agreement, unless otherwise approved in writing by City Publications, the franchisee (nor any partner, officer, director, member, executive, professional staff, or sales staff, or their spouses) cannot directly or indirectly own an interest in, manage, operate, be employed by in a sales or management capacity, or act as a consultant to any Competitive Business. This restriction applies anywhere. The franchisee is also prohibited from diverting business from customers of the franchised City Publications business or other City Publications businesses to any Competitive Business.
After the termination or expiration of the agreement, these restrictions continue for a period of two years. During this time, the franchisee is restricted from the same activities related to a Competitive Business. These restrictions are in place to protect City Publications' interests and the franchise system, and the franchisee acknowledges that these restrictions are essential to the agreement. Breaching these covenants could result in irreparable injury to City Publications, potentially leading to legal remedies such as restraining orders and injunctions.