What happens if a City Wide franchisee is party to another franchise agreement with City Wide that City Wide has terminated?

According to City Wide's 2025 Franchise Disclosure Document, if a franchisee is party to another franchise agreement with City Wide, and City Wide has terminated that other agreement, it can be grounds for terminating the current franchise agreement. Specifically, City Wide can terminate the current agreement if the other franchise agreement was terminated according to its terms. However, there is an exception: termination of the other agreement cannot be based solely on the franchisee's failure to meet Annual Revenue Per Capita Growth requirements or similar growth requirements.

This means that a City Wide franchisee's performance across all their franchise agreements with City Wide is interconnected. Failure to meet the terms of one agreement, leading to its termination, can trigger the termination of other agreements, unless the failure is specifically related to revenue growth targets. This clause incentivizes franchisees to maintain compliance across all their City Wide franchises, as a breach in one area could have a domino effect.

For a prospective City Wide franchisee, this highlights the importance of carefully managing all franchise agreements with City Wide. It's crucial to understand the specific terms and conditions of each agreement and to ensure compliance to avoid triggering a default that could jeopardize all City Wide franchises owned by the franchisee. Franchisees should pay close attention to performance metrics beyond just revenue growth, as failures in other areas can lead to termination, regardless of overall revenue.