factual

What is the maximum duty permitted by law that the franchisee is bound by in the City Publications agreement?

City_Publications Franchise · 2025 FDD

Answer from 2025 FDD Document

FOR THE STATE OF WISCONSIN

This Amendment to the Franchise Agreement is agreed to this day of, 20, between CITY PUBLICATIONS FRANCHISE GROUP, INC. and to amend and revise said Franchise Agreement as follows: 1. The Wisconsin Fair Dealership Law Title XIV-A Ch. 135, Sec. 135.01-135.07 will supersede any conflicting terms of the Franchise Agreement. 2. This provision of this Amendment shall be effective only to the extent that the jurisdictional requirements of the Wisconsin Fair Dealership Law applicable to the provisions are met independent of this Amendment. To the extent this addendum shall be deemed to be inconsistent with any terms or conditions of said Franchise Agreement or exhibits or attachments thereto, the terms of this addendum shall govern. IN WITNESS WHEREOF, each of the undersigned hereby acknowledges having read this Amendment, and understands and consents to be bound by all of its terms. CITY PUBLICATIONS FRANCHISE GROUP, INC.:

EXHIBIT D TO THE DISCLOSURE DOCUMENT

CITY PUBLICATIONS FRANCHISE GROUP, INC.

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FOR THE STATE OF MARYLAND

This Amendment to the Franchise Agreement is agreed to this day of, 20, between CITY PUBLICATIONS FRANCHISE GROUP, INC. and as follows: to amend and revise said Franchise Agreement 1. In recognition of the requirements of the Maryland Franchise Registration and Disclosure Law, Md. Code be amended as follows: Ann., Bus. Reg. §§14-201-14-233, the Franchise Agreement for CITY PUBLICATIONS FRANCHISE GROUP, INC. shall ◼ Sections 5B.10 and 20B.2 of the Franchise Agreement require Franchisee to sign a general release as a condition of renewal and transfer of the franchise; such release shall exclude claims arising under the Maryland Franchise Registration and Disclosure Law. ◼ Section 18B1.h of the Franchise Agreement which terminates the Franchise Agreement upon the bankruptcy of the Franchisee may not be enforceable under federal bankruptcy law (11 U.S.C. Section 101, et seq.). ◼ Section 24A of the Franchise Agreement requires that the franchise be governed by Georgia Law; however, in the event of a conflict of lawsto the extent required by the Maryland Franchise Registration and Disclosure Law, Maryland law shall prevail. ◼ Sections 24B and 24G of the Franchise Agreement require litigation or arbitration to be conducted in the State of Georgia; the requirement shall not limit any rights Franchisee may have under the Maryland Franchise Registration and Disclosure Law to bring suit in the State of Maryland. ◼ Any claims arising under the Maryland Franchise Registration and Disclosure Law must be brought within three (3) years after the grant of the franchise. 2. 3. Each provision of this Amendment shall be effective only to the extent that the jurisdictional requirements of the Maryland Franchise Registration and Disclosure Law applicable to the provisions are met independent of this Amendment. To the extent this addendum shall be deemed to be inconsistent with any terms or conditions of said Franchise Agreement or exhibits or attachments thereto, the terms of this addendum shall govern. Based on our financial condition, the Maryland Securities Commissioner has required a financial assurance. Therefore, all initial fees and payments owed by franchisees shall be deferred until we complete our pre-opening obligations under the franchise agreement. IN WITNESS WHEREOF, each of the undersigned hereby acknowledges having read this Amendment, and understands and consents to be bound by all of its terms. CITY PUBLICATIONS FRANCHISE GROUP, INC.:

FOR THE STATE OF MINNESOTA


In recognition of the requirements of the California Franchise Investment Law, Cal.

Corp.

Code §§31000-31516 and the California Franchise Relations Act, Cal.

Bus.

And Prof.

Code §§20000-20043, the Franchise Agreement for CITY PUBLICATIONS FRANCHISE GROUP, INC. shall be amended as follows:

  • The California Franchise Relations Act provides rights to the Franchise concerning termination or nonrenewal of the Franchise Agreement, which may supersede provisions in the Franchise Agreement, specifically Sections 5.B and 19.

  • Sections 5B.10 and 20B.2 of the Franchise Agreement require Franchisee to sign a general release as a condition of renewal and transfer of the franchise; such release shall exclude claims arising under California Franchise Investment Law and California Franchise Relations Act.

  • Section 17A of the Franchise Agreement contains a covenant not to compete which extends beyond the expiration or termination of the Franchise Agreement; this covenant may not be enforceable under California law.

  • Section 18B.1.h of the Franchise Agreement which terminates the Franchise Agreement upon the bankruptcy of the Franchisee may not be enforceable under federal bankruptcy law (11 U.S.C.

Section 101, et seq.).

  • The Franchise Agreement requires litigation to be conducted in a court located in the State of Georgia.

This provision might not be enforceable for any cause of action arising under California law.

  • The Franchise Agreement requires application of the laws of the State of Georgia.

This provision might not be enforceable under California law.

  • Section 19E of the Franchise Agreement contains a liquidated damages clause.

Under California Civil Code Section 1671, certain liquidated damages clauses are unenforceable.

  • Section 24G of the Franchise Agreement requires binding arbitration.

The arbitration will occur at the forum indicated in Section 24B with the costs being borne by the prevailing party.

Prospective franchisees are encouraged to consult legal counsel to determine the applicability of California and federal laws (such as Business and Professions Code Section 20040.5, Code of Civil Procedure Section 1281, and the Federal Arbitration Act) to any provisions of the Franchise Agreement restricting venue to a forum in the State of Georgia.


D.E.I.

FRANCHISE SYSTEMS, INC.:

FOR THE STATE OF RHODE ISLAND

This Amendment to the Franchise Agreement is agreed to this day of, 20, between CITY PUBLICATIONS FRANCHISE GROUP, INC. and to amend and revise said Franchise Agreement as follows: 1. In recognition of the requirements of The Rhode Island Franchise Investment Act §19-28.1-14, the Franchise Agreement for CITY PUBLICATIONS FRANCHISE GROUP, INC. shall be amended as follows: ◼ Sections 5B.10 and 20B.2 of the Franchise Agreement require Franchisee to sign a general release as a condition of renewal and transfer of the franchise; such release shall exclude claims arising under The Rhode Island Franchise Investment Act. ◼ Sections 24A and 24B of the Franchise Agreement shall be amended to state that restricting jurisdiction or venue to a forum outside the state of Rhode Island or requiring the application of the laws of another state is void with respect to a claim otherwise enforceable under The Rhode Island Franchise Investment Act. 2. Each provision of this Amendment shall be effective only to the extent that the jurisdictional requirements of the Rhode Island law applicable to the provisions are met independent of this Amendment. To the extent this addendum shall be deemed to be inconsistent with any terms or conditions of said Franchise Agreement or exhibits or attachments thereto, the terms of this addendum shall govern. IN WITNESS WHEREOF, each of the undersigned hereby acknowledges having read this Amendment, and understands and consents to be bound by all of its terms. CITY PUBLICATIONS FRANCHISE GROUP, INC.:

Source: Item 23 — RECEIPT (FDD pages 39–129)

What This Means (2025 FDD)

According to the 2025 City Publications Franchise Disclosure Document, the agreement is subject to certain state laws that may supersede the franchise agreement. For example, the Maryland Franchise Registration and Disclosure Law, the California Franchise Investment Law, the California Franchise Relations Act and The Rhode Island Franchise Investment Act.

Specifically, for franchisees in California, certain provisions in Section 17A regarding covenants not to compete extending beyond the termination of the agreement may not be enforceable under California law. Additionally, the requirement for litigation to be conducted in Georgia might not be enforceable for causes of action arising under California law. Similarly, the application of Georgia law may not be enforceable under California law, and liquidated damages clauses in Section 19E may be unenforceable under California Civil Code Section 1671.

For franchisees in Maryland, the Maryland Franchise Registration and Disclosure Law dictates that any release required for renewal or transfer of the franchise will exclude claims arising under this law. The provision terminating the agreement upon the franchisee's bankruptcy may not be enforceable under federal bankruptcy law. Furthermore, while the agreement stipulates Georgia law, Maryland law will prevail to the extent required by the Maryland Franchise Registration and Disclosure Law. Litigation or arbitration requirements in Georgia will not limit the franchisee's right to bring suit in Maryland under this law, and any claims must be brought within three years after the franchise grant.

For franchisees in Wisconsin, the Wisconsin Fair Dealership Law will supersede any conflicting terms of the Franchise Agreement. For franchisees in Rhode Island, restricting jurisdiction or venue to a forum outside the state of Rhode Island or requiring the application of the laws of another state is void with respect to a claim otherwise enforceable under The Rhode Island Franchise Investment Act.

Disclaimer: This information is extracted from the 2025 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.