Under what conditions can Chicken Guy reduce the scope of a covenant in Section 21?
Chicken_Guy Franchise · 2025 FDDAnswer from 2025 FDD Document
- E. Modification. Chicken Guy shall have the right, in its sole discretion, to reduce the scope of any covenant in this Section 21 effective immediately upon Franchisee's receipt of written notice, and Franchisee agrees that it shall comply forthwith with any covenant as so modified, which shall be fully enforceable notwithstanding the provisions of Section 29.
Source: Item 22 — CONTRACTS (FDD page 50)
What This Means (2025 FDD)
According to Chicken Guy's 2025 Franchise Disclosure Document, Chicken Guy has the right to reduce the scope of any covenant in Section 21. This modification can be made at Chicken Guy's sole discretion.
For a prospective franchisee, this means that Chicken Guy can change the terms of the covenants outlined in Section 21 of the franchise agreement. These changes become effective immediately upon the franchisee receiving written notice from Chicken Guy. The franchisee is then obligated to comply with the modified covenant.
This clause is fully enforceable, regardless of the provisions in Section 29 of the agreement. This gives Chicken Guy considerable flexibility in altering the franchisee's obligations under Section 21, potentially impacting the franchisee's operational freedom or financial responsibilities. Franchisees should carefully consider the implications of this clause and seek legal counsel to understand their rights and obligations fully.