Is there any exception to the restriction on other employment for Beehive Homes franchisees after the agreement terminates, expires, or is transferred?
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.
Source: Item 23 — RECEIPTS (FDD pages 34–123)
What This Means (2025 FDD)
According to Beehive Homes' 2025 Franchise Disclosure Document, there is an exception to the non-compete clause. Franchisees are restricted from engaging in a similar business for three years after the agreement concludes. However, this restriction does not apply if the franchisee obtains written consent from Beehive Homes. This means a franchisee could potentially work in a similar business or operate a competing business if Beehive Homes provides explicit written permission. Without this consent, the franchisee is bound by the non-compete terms. This non-compete also applies to the franchisee's officers, directors, shareholders, partners, managers, members, and equity owners.
This consent provision offers some flexibility for franchisees after their agreement ends. It is not uncommon for franchise agreements to include non-compete clauses to protect the brand's market share and proprietary information. However, the possibility of obtaining written consent provides an avenue for franchisees to pursue related business opportunities under certain circumstances. A prospective franchisee should carefully consider the implications of this non-compete clause and the conditions under which Beehive Homes might grant such consent.
It is important to note that the restriction applies in any location where Beehive Homes' Names and Marks are registered. This broad geographic scope means that the franchisee's ability to work in a similar business is limited not just to the immediate vicinity of their former franchise location but potentially across a wider area where the brand operates. Therefore, understanding the geographic reach of Beehive Homes' registered Names and Marks is crucial for any franchisee considering future business ventures after leaving the Beehive Homes system.