For Beehive Homes, does the non-competition agreement apply if the franchisee ceases operations at the location?
Beehive_Homes Franchise · 2025 FDDAnswer from 2025 FDD Document
or other lien holder.
- 8.7. Conflict of Interest. Franchisee covenants that for the duration of this Agreement: (a) neither it nor any Equity Owner shall be employed by or have any direct or indirect financial or ownership interest in any other business providing services of the type described in this Agreement or in the Manual unless such other business is operated pursuant to a franchise granted by Franchisor or its Affiliates; and (b) it will require its resident manager and all employees to execute Franchisor's standard Non-Competition and Non-Disclosure Agreement, signed copies of which will be forwarded by Franchisee to Franchisor within one (1) week after execution or upon the date of employment, whichever is sooner.
- 8.8. Inspections.
Source: Item 23 — RECEIPTS (FDD pages 34–123)
What This Means (2025 FDD)
The 2025 Beehive Homes Franchise Disclosure Document states that franchisees must ensure their resident manager and all employees sign Beehive Homes' standard Non-Competition and Non-Disclosure Agreement. Franchisees are required to forward signed copies of these agreements to Beehive Homes within one week of execution or employment, whichever comes first. This indicates that Beehive Homes places importance on protecting its business interests through non-competition agreements with those directly involved in the operations of the franchised location. However, the FDD does not explicitly state whether the non-competition agreement extends to the franchisee themselves if they cease operations at the location.
While the FDD outlines various obligations of the franchisee upon termination or expiration of the agreement, such as ceasing operations, removing signs, and disconnecting phone numbers, it does not directly address the applicability of a non-competition agreement in this scenario. The franchisee is obligated to cease all operations at the location and take steps to disassociate from Beehive Homes, but the document does not specify whether they are restricted from engaging in similar businesses after ceasing operations.
Therefore, it remains unclear from the provided excerpts whether the non-competition agreement applies to the franchisee if they cease operations. A prospective franchisee should seek clarification from Beehive Homes regarding the specific terms and duration of any non-competition obligations that would apply to them personally should they cease operating the franchise. Understanding these terms is crucial for assessing the long-term implications of investing in a Beehive Homes franchise.