If Mr. Sandless reduces the scope of a covenant, when does the modification become effective?
Mr_Sandless Franchise · 2025 FDDAnswer from 2025 FDD Document
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- I understand and acknowledge that the Company shall have the right, in its sole discretion to reduce the scope of any covenant set forth in this Agreement, or any portion thereof, without my consent, effective immediately upon receipt by me of written notice thereof; and I agree to comply forthwith with any covenant as so modified.
Source: Item 22 — CONTRACTS (FDD page 42)
What This Means (2025 FDD)
According to Mr. Sandless's 2025 Franchise Disclosure Document, Mr. Sandless 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 Mr. Sandless. The franchisee must then comply with the covenant as modified.
This clause gives Mr. Sandless significant flexibility to adjust the franchise agreement terms. For a potential franchisee, this means that the restrictions and obligations they initially agree to could be altered during the term of the agreement. It is important to understand that these changes can be made without the franchisee's explicit approval.
This type of unilateral modification clause is not uncommon in franchising, but franchisees should carefully consider the potential impact. It is advisable to seek legal counsel to fully understand the implications of such a clause and to assess the potential risks associated with it. Franchisees should also inquire about the circumstances under which Mr. Sandless might invoke this right and how frequently it has been used in the past.