Can Afuri Ramen Dumpling restrict the services and goods an Afuri Ramen Dumpling franchisee can offer?
Afuri_Ramen_Dumpling Franchise · 2024 FDDAnswer from 2024 FDD Document
- 3 COVENANT OF NON-USE.
You agree not to use Confidential Information or the System, except as authorized by us.
You will obligate your owners, board of directors, your employees, and your agents to the same non-use covenant.
We must approve in writing any use of Confidential Information or System by you or your owners or your directors or employees.
- 4 RETURN OF CONFIDENTIAL INFORMATION.
You agree that all originals and copies of records, data, reports, documents, lists, plans, drawings, correspondence, memoranda, notes, and other materials related to or containing any Confidential Information, in whatever form they exist, whether written, visual, audio, video, or other form of media, shall be our sole and exclusive property.
Upon request by us, you will promptly return to us all documents or other tangible property that contains Confidential Information.
- 5 RECIPES.
Without limiting the generality of the non-disclosure and non-use provisions in this Agreement, you specifically agree not to disclose or use our recipes (by yourself or by or through any other entity or individual) in any manner other than in connection with Afuri franchises pursuant to the Franchise Agreement.
6 NON-COMPETITION COVENANT.
6.1 Covenant. During the term of your association with Franchisee and for two years thereafter, you will not directly or indirectly (including by or through any other person or entity) participate as an owner, director, officer, employee, consultant, licensor, licensee, distributor, or agent, or serve in any other capacity in any business engaged in the offer, sale, or promotion of: (1) ramen, (2) other Japanese style cuisine, (3) Vietnamese pho, or (4) any business that offers products or services that are essentially the same as, or substantially similar to, the products and se
Source: Item 23 — Receipts (FDD pages 50–189)
What This Means (2024 FDD)
According to Afuri Ramen Dumpling's 2024 Franchise Disclosure Document, the franchise agreement includes non-competition covenants that restrict the goods and services a franchisee can offer, both during the term of the agreement and for a period after termination or transfer. Specifically, during the term of the franchise agreement, franchisees are restricted from using confidential information or the system except as authorized by Afuri Ramen Dumpling.
The non-competition covenant extends for two years after termination, expiration, or transfer of the agreement. During this period, the franchisee and their owners are restricted from participating in any business engaged directly or indirectly in the offer, sale, rental, internet dissemination, or promotion of ramen, other Japanese style cuisine, Vietnamese pho, or any business that offers products or services that are essentially the same as, or substantially similar to, the products and services that are part of the Afuri Ramen Dumpling system.
These restrictions apply within the Franchise Territory, within a 50-mile radius of the Franchise Territory, within a 50-mile radius of any location or franchise territory where Afuri Ramen Dumpling operates or has granted a franchise, and within the United States of America. Exceptions may apply if the franchisee operates one or more existing restaurants that offer similar food items, as detailed in the Pre-Existing Business Addendum to the Franchise Agreement. The franchisee acknowledges that these restrictions are fair and reasonable and will not cause undue hardship.