Does the Crown Gold Exchange Guaranty consider each covenant independent of other provisions?
Crown_Gold_Exchange Franchise · 2024 FDDAnswer from 2024 FDD Document
Guarantor agrees that each of the foregoing covenants is independent of any other covenant or provision of this Guaranty or the Franchise Agreement.
If all or any portion of the covenants in this Section is held to be unenforceable or unreasonable by any court or arbitrator, then the parties intend that the court or arbitrator modify such restriction to the extent reasonably necessary to protect the legitimate business interests of Crown Gold Franchising.
Guarantor agrees that the existence of any claim it or Franchisee may have against Crown Gold Franchising shall not constitute a defense to the enforcement by Crown Gold Franchising of the covenants of this Section.
If Guarantor fails to comply with the obligations under this Section during the restrictive period, then the restrictive period will be extended an additional day for each day of noncompliance.
Source: Item 22 — CONTRACTS (FDD pages 38–39)
What This Means (2024 FDD)
According to the 2024 Franchise Disclosure Document, Crown Gold Exchange's Guaranty agreement specifies that each covenant within the agreement is considered independent of any other covenant or provision, whether within the Guaranty itself or the Franchise Agreement. This means that if one part of the agreement is found to be unenforceable, it does not automatically invalidate the rest of the agreement.
This independence clause is further clarified by stating that if a court or arbitrator finds any part of the covenants unenforceable or unreasonable, the intention is for the court or arbitrator to modify the restriction only to the extent necessary to protect the legitimate business interests of Crown Gold Franchising. This allows for adjustments to be made to specific clauses without jeopardizing the entire agreement.
Furthermore, the Guarantor agrees that any claim they or the Franchisee may have against Crown Gold Franchising will not serve as a defense against Crown Gold Franchising's enforcement of the covenants within the agreement. This provision ensures that the obligations under the Guaranty remain enforceable, regardless of any disputes that may arise between the parties. If the Guarantor fails to meet their obligations during the restrictive period, that period will be extended by one day for each day of noncompliance, adding an additional layer of enforcement.