Does the Successor Addendum specify any conditions under which the agreement with City Wide might be terminated?
City_Wide Franchise · 2025 FDDAnswer from 2025 FDD Document
Termination.
Unless otherwise agreed to by the Parties, a t any time after the Initial Term, either Partymay terminate this Agreement upon providing ninety (90) days written notice to the other Party, with the termination effective on the ninetieth day from date of delivery of the written notice.
City Wide will have the right, without incurring any liability to Franchisee, by notice in writing effective when given, to terminate this Agreement in the event the Franchise Agreement is terminated by City Wide.
Source: Item 22 — CONTRACTS (FDD page 65)
What This Means (2025 FDD)
According to the 2025 City Wide Franchise Disclosure Document, the Successor Addendum does not explicitly detail conditions under which the agreement might be terminated. However, the document does state that City Wide has the right to terminate the agreement if the Franchise Agreement is terminated by City Wide. Additionally, either party can terminate the agreement after the initial term by providing a 90-day written notice to the other party.
To qualify for a Successor Term, several conditions must be met. The initial agreement must be in full force and effect, and the franchisee must provide written notice of their desire to enter a Successor Term at least one year before the current term expires. City Wide will then inspect the franchised business and equipment 90 days before the term's expiration, requiring the franchisee to complete any necessary maintenance and upgrades within 30 days after the term expires.
It is important to note that the Successor Franchise Agreement may contain terms that differ from the original agreement, including potentially higher royalty and marketing fees. A franchisee must also execute the form of franchise agreement being used by City Wide at the time of renewal, including the Successor Addendum, and pay a Successor Fee equal to 50% of the then-current Initial Franchise Fee. A prospective franchisee should carefully review the full Successor Franchise Agreement and Addendum to understand all terms and conditions, including those related to termination.