What is the duration of the restriction on other employment for Beehive Homes franchisees after termination, expiration, or transfer of the agreement?
Beehive_Homes Franchise · 2025 FDDAnswer from 2025 FDD Document
- 12.1. Noncompetition. During the Term of this Agreement and for a period of three (3) years after the Transfer, termination or expiration of this Agreement, or if later, the Franchisee's cessation of operations at the Location, the Franchisee shall not, and if Franchisee is a corporation or other legal entity, its officers, directors, shareholders, partners, managers, members and Equity Owner(s) shall not, in any capacity, directly or indirectly, except with the written consent of Franchisor, engage in any business which is the same or substantially similar to the type of business covered by this Agreement in any location for which any of the Names and Marks is registered. The Franchisee will not employ or seek to employ any person who is at the same time employed by any business operated by Franchisor or any of its Affiliates, franchisees or other licensees and will not, directly or indirectly, induce any such person to leave his or her employment unless the Franchisee has obtained the prior written approval of Franchisor.
- 12.2. Nondisclosure. During the Term of this Agreement or thereafter, the Franchisee shall not, and if Franchisee is a corporation or other legal entity, its officers, directors, shareholders, partners, managers, members and Equity Owner(s) shall not, communicate or divulge to or use for the benefit of any person, corporation or other legal entity, any Trade Secrets or other information or knowledge concerning the methods of operation and promotion of the Franchisor's System, or
Source: Item 23 — RECEIPTS (FDD pages 34–123)
What This Means (2025 FDD)
According to Beehive Homes's 2025 Franchise Disclosure Document, franchisees face certain restrictions on employment after the franchise agreement ends. Specifically, for a period of three years following the transfer, termination, or expiration of the agreement, the franchisee (and, if the franchisee is a corporation or other legal entity, its officers, directors, shareholders, partners, managers, members, and Equity Owner(s)) is prohibited from engaging in any business that is the same or substantially similar to the Beehive Homes business.
This restriction applies in any location where Beehive Homes' Names and Marks are registered. To engage in a similar business during this three-year period, the franchisee must obtain written consent from Beehive Homes. This non-compete clause prevents former franchisees from directly competing with Beehive Homes and potentially leveraging confidential information or business practices gained during their time as a franchisee.
This type of restrictive covenant is common in franchising to protect the brand and business model. Prospective Beehive Homes franchisees should carefully consider the implications of this three-year restriction, as it could limit their career options if they decide to leave the franchise system. It is important to understand the scope of the restriction, including the geographic area covered and the definition of "substantially similar" business, to assess the potential impact on future employment or business ventures.