Under what condition can City Publications terminate the agreement if a part is deemed illegal?
City_Publications Franchise · 2025 FDDAnswer from 2025 FDD Document
Each paragraph, part, term and/or provision of this Agreement shall be considered severable, and if, for any reason, any paragraph, part, term and/or provision herein is determined to be invalid and contrary to, or in conflict with, any existing or future law or regulation, such shall not impair the operation of or affect the remaining portions, paragraphs, parts, terms and/or provisions of this Agreement, and the latter shall continue to be given full force and effect and bind the parties hereto; and said invalid paragraphs, parts, terms and/or provisions shall be deemed not part of this Agreement; provided, however, that if Franchisor determines that said finding of illegality adversely affects the basic consideration of this Agreement, Franchisor may, at its option, terminate this Agreement.
Source: Item 23 — RECEIPT (FDD pages 39–129)
What This Means (2025 FDD)
According to City Publications' 2025 Franchise Disclosure Document, the agreement contains a severability clause. This means that if any part of the agreement is deemed invalid or conflicts with existing or future laws, that specific part will be removed without affecting the rest of the agreement.
However, City Publications retains the option to terminate the entire agreement if it determines that the finding of illegality concerning a specific part of the agreement adversely affects the fundamental basis of the agreement. This clause protects City Publications from being bound by an agreement that is significantly altered due to legal challenges to specific provisions.
For a prospective franchisee, this means that while minor legal issues may not necessarily lead to termination, any issue that fundamentally undermines the agreement could give City Publications grounds to terminate the franchise agreement. It is important for franchisees to understand what constitutes the 'basic consideration' of the agreement to assess this risk.