If City Wide reduces the scope of the non-compete covenants, when does the modification take effect?
City_Wide Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee understands and acknowledges that CITY WIDE will have the right, in its sole and absolute discretion, to reduce the scope of any covenant set forth in Paragraphs 3 and 4 in this Non-Compete Agreement, or any portion thereof, without Franchisee's consent, effective immediately upon receipt by Franchisee of written notice thereof, and Franchisee will comply forthwith with any covenant as so modified, which will be fully enforceable notwithstanding any contrary provisions of the Franchise Agreement, if any.
Source: Item 22 — CONTRACTS (FDD page 65)
What This Means (2025 FDD)
According to City Wide's 2025 Franchise Disclosure Document, City Wide has the right to reduce the scope of the non-compete agreement without the franchisee's consent. If City Wide chooses to reduce the scope of any covenant within the non-compete agreement, the modification becomes effective immediately.
For a prospective City Wide franchisee, this means that the franchisor can unilaterally change the terms of the non-compete agreement, potentially allowing the franchisee to compete in a broader area or market sooner than originally agreed. The franchisee is bound to comply with the modified covenant immediately upon receiving written notice from City Wide.
This immediate modification is fully enforceable, regardless of any conflicting provisions in the Franchise Agreement. City Wide will provide written notice to the franchisee when such changes occur, and the franchisee must comply with the modified terms forthwith.