If a provision of the Coffee News agreement is deemed invalid, can it be modified to make it valid?
Coffee_News Franchise · 2025 FDDAnswer from 2025 FDD Document
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 restrictive covenants within the agreement is considered unreasonable, arbitrary, or against public policy, it will be treated as divisible in terms of time and region. This means a court may reduce the time period or geographical area to make the covenant reasonable and enforceable.
Specifically, the Coffee News franchise agreement states that if a court finds the specified time period or geographical area of any covenant unreasonable, arbitrary, or against public policy, it can enforce a lesser time period or geographical area that is deemed reasonable and not against public policy. This ensures that the entire agreement doesn't become invalid due to one unreasonable clause.
However, the Coffee News agreement explicitly states that while a court can modify the time period or geographical area, the parties do not intend for a court to modify the payment terms. This means that the financial obligations outlined in the agreement are intended to remain unchanged, even if other parts of the agreement are adjusted for enforceability.