What triggers the start of the two-year post-term covenant not to compete for a Batteries Plus Bulbs franchise?

According to the 2025 Batteries Plus Bulbs Franchise Disclosure Document, the two-year post-term covenant not to compete is triggered by the expiration or termination of the Franchise Agreement, or the date on which the franchisee ceases to conduct the business franchised under the agreement, whichever event occurs later. This means that a franchisee is restricted from engaging in competitive business activities for two years following the end of their franchise relationship with Batteries Plus Bulbs.

This restriction applies to the franchisee and each principal owner, preventing them from directly or indirectly owning, operating, or being involved with any business that competes with Batteries Plus Bulbs. This includes businesses that distribute or sell batteries, light bulbs, related products, device repair services, key fob repair or replacement, or any other services offered at a Batteries Plus Bulbs store. The non-compete extends to any related business that is competitive with or similar to a Batteries Plus Bulbs store.

For a multiple-unit franchisee, the post-term covenant not to compete extends for two years from the date of termination or expiration of the agreement. During this period, the franchisee and each principal owner are prohibited from engaging in a Competing Business within a fifteen-mile radius of the Designated Area or within a fifteen-mile radius of any then-existing Batteries Plus® store outside the Designated Area. However, these restrictions do not apply to stores operated under separate individual Franchise Agreements or the ownership of securities listed on a stock exchange or traded on the over-the-counter market that represent one percent (1%) or less of the class of securities.

The agreement also specifies that the length of time of the non-compete period will be tolled (suspended) for any period during which the franchisee is in breach of the covenants or any other period during which Batteries Plus Bulbs seeks to enforce the agreement. This means that any violation or legal action taken by Batteries Plus Bulbs to enforce the agreement can extend the duration of the non-compete obligation beyond the initial two-year period.