If a provision of the Bambu MUD Agreement is deemed unenforceable, what actions can be taken?
Bambu Franchise · 2025 FDDAnswer from 2025 FDD Document
- 24.9 Invalidity.
In the event that any arbitrator or court of competent jurisdiction determines that any provision of this Agreement, including but not limited to any of the restrictive covenants contained in Article 21 hereof, are unenforceable as written for any reason, including for purposes of the restrictive covenants, reasons that the areas of restriction exceed the reasonable maximum time period, geographic area or scope, then the parties hereby request and authorize the arbitrator or court to "blue pencil" such provision so as to make it enforceable and to best carry out the intent of the parties, or to deem such provision severed from this Agreement if it cannot be so modified.
The holding, declaration or pronouncement shall not adversely affect any other provisions of this Agreement, which shall otherwise remain in full force and effect.
Source: Item 23 — Receipts (FDD pages 52–209)
What This Means (2025 FDD)
According to Bambu's 2025 Franchise Disclosure Document, if a court or arbitrator finds any provision of the MUD Agreement unenforceable, including restrictive covenants, they are authorized to modify the provision to make it enforceable. This modification is referred to as "blue penciling," and the goal is to best reflect the original intent of both parties.
If the provision cannot be modified to be enforceable, the arbitrator or court can deem that specific provision as severed from the agreement. This means that the unenforceable part is removed, but the rest of the agreement remains in effect.
Regardless of whether the provision is modified or severed, the rest of the MUD Agreement remains valid and enforceable. This ensures that the entire agreement is not invalidated due to one unenforceable clause. This clause applies to all provisions within the agreement, including but not limited to the restrictive covenants outlined in Article 21.