Under what conditions are the Initial Fees paid to City Wide nonrefundable?
City_Wide Franchise · 2025 FDDAnswer from 2025 FDD Document
3.1 Initial Fees. Contemporaneously with Franchisee's execution of this Agreement, Franchisee must pay CITY WIDE an initial franchise fee ("Initial Franchise Fee") of Seventy Thousand Dollars ($70,000); plus, an initial training fee ("Initial Training Fee") of Seven Thousand Five Hundred Dollars ($7,500) plus an initial territory fee ("Initial Territory Fee") in the amount set forth on Attachment B plus a Technology Provisioning Fee ("Technology Provisioning Fee") of Twelve Thousand Five Hundred Dollars ($12,500) as set forth below. Initial Franchise Fee, Initial Training Fee, Initial Territory Fee and Technology Provisioning Fee are collectively referred to herein as the "Initial Fees."
3.4 Refunds. The Initial Fees will be deemed fully earned upon their payment and are nonrefundable, except as provided below:
3.4.1 If CITY WIDE, at its sole and absolute right, after evaluating Franchisee's personal abilities, aptitudes, and financial qualifications to be a franchisee, elects within fifteen (15) days
following the submission of all data to terminate this Agreement, Franchisee shall receive a refund of the Initial Fees, less an evaluation fee which will not exceed Two Thousand Five Hundred Dollars ($2,500).
3.4.2 If Franchisee is unable to provide adequate proof of financing or have sufficient assets and in an acceptable form, at CITY WIDE's sole and absolute right, within thirty (30) days of the execution of this Agreement, then upon written notice by either party, CITY WIDE or Franchisee may terminate this Agreement and CITY WILL shall refund the Initial Fees paid to CITY WIDE by Franchisee, less the sum of Two Thousand Five Hundred Dollars ($2,500) in payment for CITY WIDE's expenses incurred on Franchisee's behalf.
3.4.3 If Franchisee or its designees do not successfully complete the required initial training program or fail to secure an acceptable site for the Franchised Business's office, as determined by CITY WIDE, at its sole and absolute right, CITY WIDE may terminate this Agreement and refund to Franchisee the Initial Fees, less training and other expenses incurred by CITY WIDE, which shall not exceed Ten Thousand Dollars ($10,000).
Source: Item 22 — CONTRACTS (FDD page 65)
What This Means (2025 FDD)
According to City Wide's 2025 Franchise Disclosure Document, the initial fees, which include the Initial Franchise Fee of $70,000, the Initial Training Fee of $7,500, the Initial Territory Fee, and the Technology Provisioning Fee of $12,500, are generally nonrefundable upon payment. However, there are a few specific circumstances under which a refund, less certain expenses, may be available to the franchisee.
Specifically, City Wide may elect to terminate the agreement within 15 days of receiving all required data from the franchisee if they determine the franchisee's abilities, aptitudes, and financial qualifications are not suitable. In this case, the franchisee will receive a refund of the initial fees, minus an evaluation fee that will not exceed $2,500. Additionally, if the franchisee cannot provide adequate proof of financing or sufficient assets within 30 days of the agreement's execution, either party can terminate the agreement, and City Wide will refund the initial fees less $2,500 to cover expenses incurred by City Wide on the franchisee's behalf.
Finally, if the franchisee or their designees do not successfully complete the required initial training program or fail to secure an acceptable site for the franchised business's office, City Wide may terminate the agreement and refund the initial fees, less training and other expenses incurred by City Wide, which will not exceed $10,000. Therefore, while the initial fees are generally nonrefundable, prospective franchisees should be aware of these specific conditions under which a partial refund may be possible.