Can Extreme Art Studio unilaterally reduce the scope of the non-competition covenants in the Owners Agreement?
Extreme_Art_Studio Franchise · 2024 FDDAnswer from 2024 FDD Document
- d. You and we both believe that the covenants in this Agreement are reasonable in terms of scope, duration, and geographic area. However, we may at any time unilaterally modify the terms of this Agreement upon written notice to you by limiting the scope of the Prohibited Activities, narrowing the definition of a Competitive Business, shortening the duration of the Restricted Period, reducing the geographic scope of the Restricted Territory, and/or reducing the scope of any other covenant imposed upon you under this Agreement to ensure that the terms and covenants in this Agreement are enforceable under applicable law.
Source: Item 22 — CONTRACTS (FDD page 49)
What This Means (2024 FDD)
According to the 2024 Extreme Art Studio Franchise Disclosure Document, Extreme Art Studio has the right to unilaterally modify the terms of the agreement, including the non-competition covenants. Extreme Art Studio can do so by providing written notice to the franchisee.
Specifically, Extreme Art Studio can limit the scope of prohibited activities, narrow the definition of a competitive business, shorten the restricted period, reduce the geographic scope of the restricted territory, and/or reduce the scope of any other covenant imposed upon the franchisee. This modification ensures that the terms and covenants in the agreement are enforceable under applicable law.
This clause provides Extreme Art Studio with the flexibility to adjust the non-compete terms to comply with legal requirements or address specific situations. For a potential franchisee, this means that while the initial agreement outlines certain restrictions, Extreme Art Studio can change these restrictions, potentially making them less burdensome. However, any such changes would be communicated in writing.