If Spray Net reduces the scope of a covenant, when does the modification take effect?

According to Spray Net's 2025 Franchise Disclosure Document, if a court or agency with valid jurisdiction makes a final, unappealed decision that all or part of a covenant in the Franchise Agreement is unreasonable or unenforceable, the franchisee expressly agrees to be bound by a lesser covenant. This lesser covenant is one that imposes the maximum duty permitted by law, as if it were originally part of the agreement.

In practical terms, this means that if a specific restriction in the agreement (such as a non-compete clause) is deemed too broad or not enforceable, the franchisee is immediately subject to a narrower, legally acceptable version of that restriction. This modification takes effect as soon as the court or agency makes its final decision. The franchisee doesn't have the option to reject this modified covenant; they are bound by it as if it were initially written into the agreement.

This clause protects Spray Net by ensuring that franchisees are still bound by some form of restriction, even if the original clause is found to be overly restrictive. It also provides clarity for the franchisee, as it defines how such situations will be handled, potentially avoiding prolonged legal disputes over the enforceability of the original covenant. Franchisees should be aware of this provision, as it could impact their business activities following the termination or expiration of their franchise agreement.