In the Alloy Franchise Agreement, what happens if a court finds a clause to be unenforceable?
Alloy Franchise · 2025 FDDAnswer from 2025 FDD Document
Should one or more clauses of this Agreement be held void or unenforceable for any reason by any court of competent jurisdiction, such clause or clauses will be deemed to be separable in such jurisdiction and the remainder of this Agreement is valid and in full force and effect and the terms of this Agreement must be equitably adjusted so as to compensate the appropriate party for any consideration lost because of the elimination of such clause or clauses. It is the intent and expectation of each of the parties that each provision of this Agreement will be honored, carried out and enforced as written. Consequently, each of the parties agrees that any provision of this Agreement sought to be enforced in any proceeding must, at the election of the party seeking enforcement and notwithstanding the availability of an adequate remedy at law, be enforced by specific performance or any other equitable remedy.
Source: Item 23 — RECEIPTS (FDD pages 69–245)
What This Means (2025 FDD)
According to Alloy's 2025 Franchise Disclosure Document, if a court of competent jurisdiction deems one or more clauses of the Franchise Agreement void or unenforceable, those clauses will be treated as separable within that jurisdiction. This means the rest of the agreement remains valid and in full effect.
Furthermore, the terms of the Alloy Franchise Agreement will be equitably adjusted to compensate the appropriate party for any consideration lost due to the removal of the unenforceable clause or clauses. This adjustment aims to ensure fairness and maintain the original intent of the agreement as much as possible.
Alloy emphasizes that it is the intent and expectation of all parties that every provision of the agreement will be honored, carried out, and enforced as written. Consequently, any party seeking to enforce a provision can elect to enforce it through specific performance or any other equitable remedy, even if an adequate remedy exists at law. This highlights Alloy's commitment to upholding the agreement's provisions to the fullest extent possible.