Are Beem Light Sauna franchisees allowed to divert customers from their studio to any Competitive Business?
Beem_Light_Sauna Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in Franchise Agreement | Summary | |
|---|---|---|---|
| Franchisee Party owns the Site, we may elect to purchase the Site, or lease the Site, from that Franchisee Party. If the Site is leased from an unaffiliated lessor, you must, at our option, cause the applicable Franchisee Party to assign the lease to us or enter into a sublease with us on the same terms. | |||
| p. | Death or disability of franchisee | Section 13.8 | Executor or representative must, within 120 days after death or appointment of a personal representative or trustee, dispose of the interest under the applicable terms of Section 13 of the Franchise Agreement, except no transfer fee will be payable in connection with that disposition. |
| q. | Non-competition covenants during the term | Section 12.1 | You and your Owners may not: (A) own, manage, engage in, be employed by, advise, make loans to, or have any other interest in (i) any sauna studio, salon with a sauna offering, therapeutic light or laser treatment center, weight loss center, business selling nutritional supplements, or business involved in self-care, (ii) any business that offers products, services, or Sessions that are similar to those offered by a Studio, or (iii) any Entity that grants franchises or licenses for any of the businesses in (i) or (ii) (a "Competitive Business") in the United States; (B) divert or attempt to divert any business or customer or potential business or customer of the Studio to any Competitive Business, by direct or indirect inducement or otherwise; (C) perform, directly or indirectly, any other act injurious or prejudicial to the goodwill associated with the Marks and the System; or (D) use any vendor relationship established through your association with us for any purpose other than to purchase products or equipment for use or retail sale in the Studio. |
| r. | Non-competition covenants after the Franchise Agreement is terminated or expires | Section 12.2 | For two years after the expiration of termination of your Franchise Agreement, you and your Owners will be subject to the same restrictions stated in Item 17(q) above, except the restrictions stated in (A) and (B) of Item 17(q) will be geographically limited to any Competitive Business that is located within a 10-mile radius of your former Studio or any other Studio that is operating or under development at that time. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION THE FRANCHISE RELATIONSHIP (FDD pages 55–62)
What This Means (2025 FDD)
According to Beem Light Sauna's 2025 Franchise Disclosure Document, franchisees are prohibited from diverting customers to any competitive business. During the term of the franchise agreement, franchisees and their owners cannot own, manage, or be involved with any Competitive Business, which includes sauna studios, salons with sauna offerings, therapeutic light or laser treatment centers, weight loss centers, businesses selling nutritional supplements, or businesses involved in self-care. This also extends to businesses offering similar products, services, or sessions as a Beem Light Sauna studio, or any entity that franchises or licenses such businesses.
Specifically, franchisees are barred from diverting or attempting to divert any business or customer from the Beem Light Sauna studio to any Competitive Business, whether through direct or indirect means. They are also prohibited from any action that could harm the goodwill associated with the Beem Light Sauna brand and system. Additionally, franchisees cannot use vendor relationships established through their affiliation with Beem Light Sauna for purposes other than purchasing products or equipment for use or retail sale in their studio.
After the franchise agreement expires or is terminated, these restrictions continue for two years. During this period, franchisees and their owners face the same limitations, but the restrictions on owning or engaging with a Competitive Business and diverting customers are geographically limited to any Competitive Business within a 10-mile radius of the former Beem Light Sauna studio or any other Beem Light Sauna studio operating or under development at that time. This ensures that former franchisees do not directly compete with existing Beem Light Sauna locations in close proximity.