What is the definition of 'Immediate Family' as it relates to the restrictions on competitive businesses in the 7 Brew franchise agreement?
7_Brew Franchise · 2025 FDDAnswer from 2025 FDD Document
The term "Immediate Family" includes the named individual, his or her spouse or domestic partner, and all children of the named individual or his or her spouse or domestic partner. You agree to obtain similar covenants from your officers, directors, and other supervisory personnel, to the extent permitted by applicable Law, to the extent their competitive activities would adversely affect your Store or the 7 BREW brand. We may pre-approve the forms of agreements you use solely to ensure that you adequately protect Confidential Information and the competitiveness of 7 BREW Stores. Under no circumstances will we control the forms or terms of employment agreements you use with Store employees or otherwise be responsible for your labor relations or employment practices.
Source: Item 22 — CONTRACTS (FDD pages 82–83)
What This Means (2025 FDD)
According to 7 Brew's 2025 Franchise Disclosure Document, the term "Immediate Family" is specifically defined within the context of competitive business restrictions. It includes the individual franchisee, their spouse or domestic partner, and all children of the individual or their spouse or domestic partner. This definition is important because these individuals are also subject to certain restrictions regarding involvement with competitive businesses, as outlined in the franchise agreement.
This means that not only is the franchisee restricted from engaging in competitive business activities, but these restrictions also extend to their immediate family members. The restrictions prevent these individuals from having an ownership interest in, performing services for, or providing financial support to a competitive business. A competitive business is defined as any business that derives more than 25% of its revenue from selling coffee or franchises or licenses to others to operate such a business, other than a 7 Brew store.
This clause is designed to protect 7 Brew's market position and prevent franchisees from using inside knowledge or resources gained from the franchise to benefit a competing business. Prospective franchisees should carefully consider the implications of these restrictions on their family members and ensure they understand the scope of prohibited activities. It is also important to note that franchisees are expected to obtain similar covenants from their officers, directors, and other supervisory personnel to further protect the 7 Brew brand and confidential information.