factual

If a covenant restricting competitive activity in the Bumper Man franchise agreement is deemed unenforceable, what will happen?

Bumper_Man Franchise · 2025 FDD

Answer from 2025 FDD Document

(e) Severability and Enforceability of Covenants. Each of the covenants contained in this Section 17 will be considered separate and independent from each other. If any covenant in this Agreement which restricts competitive activity is deemed unenforceable for any reason, but would be enforceable by reducing or substituting any part of it in accordance with Section 26(a), such covenant will be enforced to the fullest extent permissible under Applicable Law.

Source: Item 23 — RECEIPTS (FDD pages 45–180)

What This Means (2025 FDD)

According to the 2025 Bumper Man Franchise Disclosure Document, the covenants within Section 17 of the franchise agreement are considered separate and independent. If any covenant restricting competitive activity is deemed unenforceable, but could be enforceable by reducing or substituting any part of it, it will be enforced to the fullest extent permissible under applicable law. This means that if a court finds a specific part of the non-compete agreement too broad or restrictive, it will attempt to modify the covenant to make it enforceable rather than invalidating the entire clause.

This provision ensures that Bumper Man can still protect its interests to the greatest extent possible. The franchisor and franchisee agree that the covenant will be enforced to the fullest extent permissible under applicable law and public policy. This may involve reducing the geographical area, the type of prohibited business activity, or the length of time the restriction is in place.

This approach is fairly standard in franchise agreements, as franchisors seek to protect their brand, trade secrets, and customer relationships. The severability clause ensures that the rest of the agreement remains in effect even if one particular provision is found to be unenforceable. Prospective franchisees should understand that while there is a possibility of a court modifying a non-compete clause, the general intent is to uphold the restriction to the extent legally possible.

Disclaimer: This information is extracted from the 2025 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.