Under what section of the City Publications franchise agreement can the initial term be terminated early?

Based on the 2025 City Publications Franchise Disclosure Document, Section 18B1.h of the Franchise Agreement addresses the termination of the agreement upon the bankruptcy of the franchisee. However, the FDD includes amendments for several states (Maryland, California, Rhode Island, Virginia and Washington) that address the enforceability of certain sections of the franchise agreement.

Specifically, the Maryland amendment indicates that Section 18B1.h, which terminates the agreement upon the franchisee's bankruptcy, may not be enforceable under federal bankruptcy law. Similarly, the Virginia amendment also notes the potential unenforceability of Section 18B.1.h due to federal bankruptcy law. The California amendment states that the California Franchise Relations Act provides rights to the Franchisee concerning termination or nonrenewal of the Franchise Agreement, which may supersede provisions in the Franchise Agreement, specifically Sections 5.B and 19.

For a prospective City Publications franchisee, these amendments highlight the importance of understanding how state and federal laws can impact the enforceability of specific clauses within the franchise agreement, particularly those related to termination and bankruptcy. Franchisees should consult with legal counsel to fully understand their rights and obligations under the agreement, taking into account any applicable state-specific regulations.