Can the Covenantor argue that the covenants in the Crave agreement impose undue hardship on them?
Crave Franchise · 2025 FDDAnswer from 2025 FDD Document
EMENT BY ANY MEANS ALLOWED BY DELAWARE OR FEDERAL LAW. COVENANTOR FURTHER AGREES THAT VENUE FOR ANY PROCEEDING RELATING TO OR ARISING OUT OF THIS AGREEMENT SHALL BE IN DELAWARE; PROVIDED, HOWEVER, WITH RESPECT TO ANY ACTION THAT INCLUDES INJUNCTIVE RELIEF OR OTHER EXTRAORDINARY RELIEF, FRANCHISOR MAY BRING SUCH ACTION IN ANY COURT IN ANY STATE THAT HAS JURISDICTION.
- e. The parties agree that each of the foregoing covenants contained herein shall be construed as independent of any other covenant or provision of this Agreement.
- f. Covenantor acknowledges and agrees that each of the covenants contained herein will not impose any undue hardship on Covenantor since Covenantor has other considerable skills, experience and education which affords Covenantor the opportunity to derive income from other endeavors.
- g. This Agreement contains the entire agreement of the parties regarding the subject matter hereof. This Agreement may be modified only by a duly authorized writing executed by all parties.
Source: Item 23 — RECEIPTS (FDD pages 63–253)
What This Means (2025 FDD)
According to Crave's 2025 Franchise Disclosure Document, the Covenantor acknowledges and agrees that the covenants within the agreement will not impose any undue hardship on them. This is based on the understanding that the Covenantor possesses other considerable skills, experience, and education, which provide them with opportunities to earn income from other endeavors. This statement suggests that Crave believes the non-compete obligations are reasonable, considering the Covenantor's ability to find alternative employment or business ventures.
However, if the period of time or the geographic scope specified in Section 2.b is deemed unreasonable in any proceeding, the agreement specifies that the period of time will be reduced by such number of months or the geographic scope will be reduced by the elimination of such portion thereof, or both, so that such restrictions may be enforced for such time and scope as are adjudged to be reasonable. In addition, Crave has the right to reduce the scope of any covenant set forth in this Agreement or any portion thereof, without Covenantor's consent, effective immediately upon receipt by Covenantor of written notice thereof, and Covenantor agrees to forthwith comply with any covenant as so modified.
This clause aims to protect Crave's interests while also ensuring that the restrictions placed on the Covenantor are fair and do not unduly prevent them from earning a livelihood. Prospective Covenantors should carefully consider their existing skills and opportunities in light of these restrictions and seek legal counsel to fully understand the implications of this provision.