If Crave modifies a covenant, when does the modification become effective?
Crave Franchise · 2025 FDDAnswer from 2025 FDD Document
- 12.5 You understand and acknowledge that we shall have the right, in our sole discretion, to reduce the scope of any covenant stated in Sections 12.1 and 12.2 or any portion thereof, without your consent, effective immediately upon receipt by you of written notice thereof, and you agree that you shall comply forthwith with any covenant as so modified, which shall be fully enforceable notwithstanding the provisions of Section 16 hereof.
Source: Item 23 — RECEIPTS (FDD pages 63–253)
What This Means (2025 FDD)
According to Crave's 2025 Franchise Disclosure Document, Crave has the right to reduce the scope of any covenant without the franchisee's consent. This modification becomes effective immediately upon the franchisee's receipt of written notice from Crave. The franchisee must then comply with the covenant as modified.
This means that Crave can unilaterally change the terms of certain agreements, such as non-compete clauses, and these changes take effect as soon as the franchisee receives written notification. The franchisee's agreement to comply with these modifications is required, regardless of any other provisions in the franchise agreement.
This clause gives Crave significant flexibility to adjust the franchise agreement terms as it sees fit, which could impact the franchisee's rights and obligations. While such modifications provide Crave with adaptability, prospective franchisees should carefully consider the potential implications of such unilateral changes and seek legal counsel to fully understand their rights and obligations.