If a part of a covenant in the Annex Brands agreement is deemed invalid, what happens?
Annex_Brands Franchise · 2025 FDDAnswer from 2025 FDD Document
If a part of a covenant in this Agreement is held invalid, unreasonable or unenforceable by a court or agency, you agree to be bound by any lesser covenant subsumed within the terms of the covenant that imposes the maximum duty permitted by law, as if the resulting covenant were separately stated in this Agreement.
If an entire covenant in this Agreement is held invalid, unreasonable or unenforceable by a court or agency, the remaining covenants in this Agreement will continue in effect.
Source: Item 23 — Receipts (FDD pages 110–299)
What This Means (2025 FDD)
According to Annex Brands' 2025 Franchise Disclosure Document, if a portion of a covenant within the agreement is deemed invalid, unreasonable, or unenforceable by a court or agency, the franchisee agrees to adhere to any lesser covenant that falls within the terms of the original covenant. This means the franchisee is bound by the maximum duty permitted by law, as if this revised covenant were explicitly stated in the agreement.
In practical terms, this "severability" clause ensures that if a specific restriction or obligation is found to be overly broad or legally unsound, a more limited and enforceable version of that covenant will still apply. This prevents the entire agreement from being invalidated due to one problematic clause. The franchisee must comply with this modified term as if it were originally part of the agreement.
Furthermore, if an entire covenant is deemed invalid, unreasonable, or unenforceable, the remaining covenants within the agreement will remain in full effect. This provision reinforces the intent to maintain the agreement's overall validity, even if specific parts are challenged and found to be legally deficient. This protects Annex Brands by ensuring the franchisee is still bound by the rest of the agreement.