What constitutes a default under another agreement with City Wide?
City_Wide Franchise · 2025 FDDAnswer from 2025 FDD Document
- 14.3 Breach of Related Agreement.
If Franchisee defaults under any term of any agreement material to the Franchised Business or any other Franchise Agreement, Development Agreement or other contract or agreement between CITY WIDE or its affiliates, on the one hand, and Franchisee or a Franchisee Affiliated Company, on the other hand, and such default is not cured within the time specified in such agreement, contract or other franchise agreement, such default shall be deemed a default under this Agreement.
Source: Item 22 — CONTRACTS (FDD page 65)
What This Means (2025 FDD)
According to City Wide's 2025 Franchise Disclosure Document, a franchisee can be considered in default if they fail to meet the terms of any agreement that is material to the franchised business. This includes any other franchise agreement, development agreement, or other contract between City Wide or its affiliates and the franchisee or an affiliated company.
Specifically, if a franchisee defaults on any term within these agreements and fails to correct the default within the time frame specified in that agreement, City Wide can consider this a default under the current franchise agreement. This clause ensures that City Wide can take action if a franchisee's failure to uphold their obligations in one area affects their overall relationship and performance within the City Wide franchise system.
This provision is important for prospective franchisees to understand, as it broadens the scope of what can trigger a default. It's not limited to just the terms of the primary franchise agreement but extends to any related agreements. A prospective franchisee should carefully review all agreements with City Wide and ensure they can comply with all terms to avoid triggering a default.