Does the restriction on owning a Competitive Business for City Publications apply to the franchisee's spouse?
City_Publications Franchise · 2025 FDDAnswer from 2025 FDD Document
agers 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.
Source: Item 23 — RECEIPT (FDD pages 39–129)
What This Means (2025 FDD)
According to City Publications' 2025 Franchise Disclosure Document, the restriction on owning a Competitive Business applies to the franchisee's spouse, both during the term of the agreement and after termination. During the term of the agreement, neither the 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, can own an interest in, manage, operate, be employed by, or act as a consultant to any Competitive Business. This restriction applies directly or indirectly, for themselves or through another entity, unless otherwise approved in writing by City Publications.
After termination of the franchise agreement, a similar restriction applies for a period of two years. During this period, neither the franchisee nor any of the aforementioned parties, including their spouses, can engage in the same competitive activities. This post-termination restriction is limited to the Exclusive Territory granted to the franchisee or within a 25-mile radius of any other City Publications business.
These restrictions are considered essential elements of the franchise agreement, and City Publications emphasizes that they would not enter into the agreement without these protections. The franchisee acknowledges that these terms, including the restrictive covenants, are fair, reasonable, and necessary to protect City Publications and its franchise system. A breach of these covenants would cause irreparable injury to City Publications, entitling them to seek equitable remedies such as restraining orders and injunctions.