Who is subject to the post-term covenant not to compete for a Batteries Plus Bulbs franchise?
Batteries_Plus_Bulbs Franchise · 2025 FDDAnswer from 2025 FDD Document
- C. Post-Term Covenant Not To Compete. Franchisee (and each Principal Owner) will not, for a period of two (2) years after this Agreement expires or is terminated or the date on which Franchisee ceases to conduct the business franchised under this Agreement, whichever is later, directly or as an
employee, agent, consultant, partner, officer, director or shareholder of any other person, firm, entity, partnership or corporation, own, operate, lease, franchise, conduct, engage in, be connected with, having any interest in, or assist any person or entity engaged in any business that distributes, sells or otherwise deals in, at wholesale or retail, any battery, light bulb or related products, any device repair, key fob repair or replacement, or other services offered at a Batteries Plus® store, or any other related business that is competitive with or similar to a Batteries Plus® store that is located at the Store or within a fifteen (15) mile radius of the former site of the Store or any other then existing Batteries Plus® store; provided, however, that this Section 14(C) will not apply to: (i) other stores that Franchisee operates under a franchise agreement with us; or (ii) the ownership of securities listed on a stock exchange or traded on the over-thecounter market that represent one percent (1%) or less of that class of securities. For purposes of this Section, any form of e-commerce business or website that distributes, sells or otherwise deals in, at wholesale or retail, any battery, light bulb or related products or any device repair, key fob repair or replacement, or other services offered at a Batteries Plus® store, or any other related business that is competitive with or similar to a Batteries Plus® store will be in violation of this provision if such ecommerce business or website offers, sells or otherwise makes its products or services available to individuals residing within or businesses located within fifteen (15) mile radius of the former site of the Store or any other then-existing Batteries Plus® store. Franchisee agrees that the length of time in this Section 14(C) will be tolled for any period during which Franchisee is in breach of the covenants or any other period during which Franchisor seeks to enforce this Agreement.
Source: Item 22 — Contracts (FDD page 80)
What This Means (2025 FDD)
According to the 2025 Batteries Plus Bulbs Franchise Disclosure Document, both the franchisee and each principal owner are subject to the post-term covenant not to compete. This covenant applies for a period of two years after the franchise agreement expires, is terminated, or the date the franchisee ceases to conduct business, whichever is later.
The covenant restricts the franchisee and principal owners from being directly or indirectly involved with any business that distributes, sells, or deals in batteries, light bulbs, related products, device repair, key fob repair or replacement, or other services offered at a Batteries Plus Bulbs store. This includes involvement as an employee, agent, consultant, partner, officer, director, or shareholder of another entity. The restriction applies to businesses located at the store or within a 15-mile radius of the former store site or any other existing Batteries Plus Bulbs store.
However, there are exceptions to this post-term covenant. It does not apply to other stores the franchisee operates under a franchise agreement with Batteries Plus Bulbs, or to the ownership of securities listed on a stock exchange or traded over-the-counter representing 1% or less of that class of securities. The agreement also specifies that any e-commerce business or website offering similar products or services within a 15-mile radius of the former store site or any existing Batteries Plus Bulbs store would violate this provision.