Does the Belocal franchise agreement consider organizing events for advertisers to sell competing publications as a 'Competitive Service'?
Belocal Franchise · 2025 FDDAnswer from 2025 FDD Document
. The term "Competitive Business" includes the following divisible and severable business lines or services (each a "Competitive Service") which the Franchisee's Franchised Business provided (a) for covenants applicable during the Term, during the Term and (b) for covenants applicable post-term, at any time within the twelve-month period prior to the termination, expiration, or transfer of this Agreement:
- (i) selling digital and/or print advertising to businesses for publication in or related to digital or print publications that compete with any N2 publication(s), including BELOCAL publications;
- (ii) publishing and/or facilitating the publishing of digital or print publications that compete with any N2 publication(s), including BELOCAL publications;
Source: Item 22 — CONTRACTS (FDD page 71)
What This Means (2025 FDD)
According to Belocal's 2025 Franchise Disclosure Document, organizing, sponsoring, or hosting events for advertisers to market competing publications is considered a 'Competitive Service.' Specifically, this includes events for advertisers in Belocal's Publication, members of Communities within the Territory, or members of Industry Groups within the Territory and within ten miles of the Territory. The purpose of these events must be to sell or market digital or print publications, or digital or print advertising in digital or print publications, that compete with any N2 publication(s).
This definition of 'Competitive Service' is relevant both during the term of the franchise agreement and for a period of twelve months after termination, expiration, or transfer of the agreement. This means that a franchisee is restricted from engaging in such activities during the franchise term and for one year afterward.
The Belocal franchise agreement specifies that these covenants are considered reasonable and necessary to protect the goodwill and legitimate business interests of the franchisor. Franchisees and their principals agree to these limitations, acknowledging that they do not impose a greater restraint than necessary. This clause is designed to prevent franchisees from directly competing with Belocal, especially using knowledge and relationships gained during their time as a franchisee.