Does City Publications have the option to purchase a franchisee's business if the City Publications franchise is terminated or expires?
City_Publications Franchise · 2025 FDDAnswer from 2025 FDD Document
| o. | Our option to purchase your franchised business | Section 19.C | We are not obligated to do so, but, if the franchise is terminated or expires, we may purchase the assets of the Franchised Business containing the Marks, at the lesser of cost or fair market value, without accounting for goodwill. | | p. | Your death or disability | Section 20.F | Your heirs, beneficiaries, devisees or legal representative can apply to us to continue operation of the Franchised Business, or sell or otherwise transfer your interest in the Franchised Business to a suitable third party | | | Provision | Section In franchise or other agreement | Summary | |----|------------------------------------------------------------------------------------------------|--------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------| | | | | within | | | | | 6 | | | | | months | | | | | of | | | | | death | | | | | or | | | | | incapacity. If | | | | | they | | | | | fail | | | | | to | | | | | do | | | | | so | | | | | within | | | | | 6 | | | | | months, | | | | | the | | | | | Franchise | | | | | Agreement | | | | | will | | | | | terminate | | | | | and | | | | | we | | | | | will | | | | | have | | | | | the | | | | | option | | | | | to | | | | | buy | | | | | assets. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 26–31)
What This Means (2025 FDD)
According to City Publications's 2025 Franchise Disclosure Document, City Publications has the option to purchase a franchisee's business if the franchise is terminated or expires. Specifically, City Publications is not obligated to make such a purchase, but it has the option to do so. If City Publications exercises this option, it may purchase the assets of the franchised business that contain the brand's marks.
The purchase price for these assets will be the lesser of their cost or fair market value. This valuation will not include any consideration for goodwill, which is the intangible value of the business beyond its physical assets. This means a franchisee might not be compensated for the brand recognition or customer base they have built.
This clause is important for prospective franchisees to understand, as it clarifies the terms under which City Publications can acquire the business upon termination or expiration of the franchise agreement. Franchisees should consider this when evaluating the potential return on investment and the long-term value of their business. It is also important to note that the heirs, beneficiaries, devisees or legal representative can apply to City Publications to continue operation of the Franchised Business, or sell or otherwise transfer your interest in the Franchised Business to a suitable third party within 6 months of death or incapacity. If they fail to do so within 6 months, the Franchise Agreement will terminate and City Publications will have the option to buy assets.