What happens if a provision of the Coffee News franchise agreement is deemed invalid?
Coffee_News Franchise · 2025 FDDAnswer from 2025 FDD Document
for any reason, that part shall be deemed modified to the extent necessary to make it valid and operative, or if it cannot be so modified, then severed, and the
remainder of the Agreement shall continue in full force or effect as if the Agreement had been signed with the invalid portion so modified or eliminated.
- 16.6 Exhibits and Schedules. All exhibits and schedules attached hereto are incorporated by reference in the appropriate paragraph and form a part of the Agreement.
- The parties to this Agreement understand and agree Enforceability. 16.7 that, if any portion of the restrictive covenants set forth in this Agreement is held to be unreasonable, arbitrary, or against public policy, then that portion of those covenants shall be considered divisible as to time and region. The parties to this Agreement agree that if any court or competent jurisdiction determines that the specified time period or the specified region of application of any covenant is unreasonable, arbitrary, or against public policy, then a lesser time period, geographical area or both, that is determined to be reasonable, non-arbitrary, and not against public policy, may be enforced against the parties hereto.
Source: Item 23 — Receipts (FDD pages 36–118)
What This Means (2025 FDD)
According to the 2025 Coffee News Franchise Disclosure Document, if any part of the franchise agreement is deemed invalid, the remainder of the agreement will remain in effect as if the agreement had been signed with the invalid portion modified or eliminated. This ensures that as much of the original agreement as possible is upheld and enforced.
Specifically regarding restrictive covenants, if any portion is held to be unreasonable, arbitrary, or against public policy, that portion will be considered divisible as to time and region. This means a court may reduce the time period or geographical area of application to make the covenant reasonable and enforceable. However, the parties involved do not intend for a court to modify the payment terms set forth in the agreement.
This clause is fairly standard in franchise agreements. It aims to preserve the overall contract while addressing specific issues that may arise. Prospective Coffee News franchisees should understand that while some terms can be adjusted, the core financial obligations are intended to remain unchanged.