factual

Under what circumstances is City Wide not obligated to contribute funds to the Franchisee's account or pay the Franchisee's financial obligations?

City_Wide Franchise · 2025 FDD

Answer from 2025 FDD Document

It is understood by Franchisee that, in the event there is not sufficient cash flow to meet Franchisee's financial obligations, City Wide is in no way obligated to contribute funds to Franchisee's account nor pay Franchisee's financial obligations.

Source: Item 22 — CONTRACTS (FDD page 65)

What This Means (2025 FDD)

According to City Wide's 2025 Franchise Disclosure Document, City Wide is not obligated to contribute funds to a franchisee's account or pay their financial obligations if there is not sufficient cash flow to meet those obligations. This stipulation is part of an agreement where City Wide provides accounting and financial services to the franchisee.

This agreement outlines that City Wide's provision of services does not imply any responsibility for the franchisee's debts, obligations, or other liabilities. The franchisee acknowledges that City Wide is not obligated to provide funds or pay obligations if the franchisee's business lacks sufficient cash flow.

This aspect of the agreement protects City Wide from being held liable for the financial shortcomings of its franchisees. It clarifies that the accounting and financial services provided are advisory and supportive, but do not extend to covering the franchisee's financial deficits. Prospective franchisees should understand that City Wide's support does not include financial bailouts and that they are solely responsible for managing their business's cash flow and financial obligations.

Disclaimer: This information is extracted from the 2025 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.