factual

For how long after the Bang Cookies franchise is terminated or expires are non-competition covenants in effect?

Bang_Cookies Franchise · 2024 FDD

Answer from 2024 FDD Document

n. Franchisor's right of first refusal to acquire franchisee's business 14.F. We have the right to match any offer to purchase your Shop or the Corporate Entity operating your Shop.
o. Franchisor's option to purchase franchisee's business Not applicable Not applicable.
p. Death or disability of franchisee 14.D. If you are an individual, within 30 days of the death or permanent disability of Franchisee, your executor and/or legal representative must appoint an Operating Manager approved by us and within 60 days of such appointment the Operating Manager must complete, to our satisfaction, our initial training program. Within 12 months of the date of death or disability, the Franchise Agreement must be transferred to a transferee approved by us and otherwise transferred in accordance with the terms of the Franchise Agreement. If the franchisee is a Corporate Entity, within 30 days of the death or permanent disability of your Managing Owner, if there are other Owners, must appoint a replacement Operating Manager approved by us and within 60 days of such appointment the replacement Operating Manager must complete, to our satisfaction, our initial training program.
q. Non-competition covenants during the term of the franchise 6 No involvement in any competitive business and must comply with confidentiality, non-disclosure and non-solicitation covenants.
r. Non-competition covenants after the franchise is terminated or expires 6, 17.C. No involvement, ownership or interest whatsoever for 24 months in any competing business in: your Designated Territory; a 25-mile radius of your Designated Territory; a 10- mile radius of the Designated Territory of any other Shop; and you must comply with confidentiality, non-disclosure and non solicitation covenants.

Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 42–49)

What This Means (2024 FDD)

According to Bang Cookies's 2024 Franchise Disclosure Document, if the franchise is terminated or expires, the franchisee is subject to a non-competition covenant for 24 months. During this period, the franchisee cannot have any involvement, ownership, or interest in any competing business within their Designated Territory.

This restriction also extends to a 25-mile radius of the franchisee's Designated Territory and a 10-mile radius of the Designated Territory of any other Bang Cookies shop. Additionally, the franchisee must continue to comply with confidentiality, non-disclosure, and non-solicitation covenants.

These post-termination restrictions are designed to protect Bang Cookies's market share, customer base, and confidential information. Prospective franchisees should carefully consider the scope and duration of these covenants, as they could significantly limit their business activities after leaving the Bang Cookies system. It is common practice in the franchise industry to have post-term non-compete clauses, but the specific terms can vary widely.

Disclaimer: This information is extracted from the 2024 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.