MONTREAL - The chairman and chief executive of Freshii sought to reassure investors about the restaurant chain's growth after it said earlier this week that it would open fewer locations than expected.

Speaking to an investor conference in Montreal, Matthew Corrin says the company could have started a process to terminate its contracts with large franchisees who failed to meet the store opening commitments in their contracts.

However, he says Freshii opted against doing that because the franchisees are doing the right things and the value in the long term is greater if the company continues to support their development.

Corrin says it would be "too short-term of a view" to penalize them now.

Freshii (FRII.TO) shares fell 35 per cent on Tuesday after the company lowered its guidance for new store openings and scaled back its longer-term expansion targets.

The company attributed the reduction to the closure of its locations in Target stores, challenges in ramping up the number of locations and a more conservative pace of store openings by its multi-unit franchisees than expected.