Does the Bang Cookies franchisee waive the right to challenge Article 6 of the franchise agreement?
Bang_Cookies Franchise · 2024 FDDAnswer from 2024 FDD Document
and (v) you will stop using the Confidential Information immediately at our request or demand. You will not use the Confidential Information for any purpose other than for the performance of your duties on behalf of us and in accordance with the scope of your work with us.
- 5. Reasonableness of Covenants and Restrictions. You agree that: the terms of this Agreement are reasonable and fair and that you have sufficient resources and business experience and opportunities to earn an adequate living while complying with the terms of this Agreement. You hereby waive any right to challenge the terms of this Agreement as being overly broad, unreasonable or otherwise unenforceable.
6. Breach. You agree that failure to comply with the terms of this Agreement will cause irreparable harm to us and to our franchisor Bang Cookies Franchise LLC, and other Bang Cookies franchisees for which there is no adequate remedy at law. Therefore, you agree that any violation of these covenants will entitle us or our Franchisor Bang Cookies Franchise LLC to injunctive relief. You agree that we and/or our Franchisor Bang Cookies Franchise LLC may apply for such injunctive relief, without bond, but upon due notice, in addition
Source: Item 23 — RECEIPTS (FDD pages 56–245)
What This Means (2024 FDD)
According to Bang Cookies's 2024 Franchise Disclosure Document, franchisees agree that failure to comply with the terms of the agreement will cause irreparable harm to Bang Cookies and its franchisees, for which there is no adequate remedy at law. Therefore, any violation of these covenants will entitle Bang Cookies to injunctive relief. The franchisee agrees that Bang Cookies may apply for such injunctive relief, without bond, but upon due notice. The franchisee's sole remedy, in the event of the entry of such injunction, will be the dissolution of such injunction, if warranted, upon hearing duly held, and all claims for damages by reason of the wrongful issuance of any such injunction are expressly waived. If a court requires the filing of a bond, the amount of the bond shall not exceed $1,000.
This means that a Bang Cookies franchisee is waiving their right to claim damages if an injunction is issued against them, even if that injunction is later found to be wrongful. The franchisee's only recourse is to attempt to dissolve the injunction. This is a significant limitation on the franchisee's legal rights and could expose them to financial risk if they are wrongly enjoined from operating their business. The franchisee also agrees that if a court requires a bond for the injunctive relief, the bond amount will be capped at $1,000, which may not be sufficient to cover potential damages.
This waiver and limitation of remedies are specific to violations of the covenants within the franchise agreement and the potential issuance of injunctions. It is important for a prospective Bang Cookies franchisee to understand the implications of these waivers and limitations, and to seek legal counsel to fully understand their rights and obligations under the franchise agreement.