What are the non-competition covenants for a Bens Soft Pretzels franchisee after the franchise is terminated or expires?
Bens_Soft_Pretzels Franchise · 2025 FDDAnswer from 2025 FDD Document
| Provision | Section in Agreement | Summary | |
|---|---|---|---|
| o. | Franchisor’s option to purchase franchisee’s business | Section 14B | Option to purchase some or all equipment, supplies, inventory, advertising materials and any items with our logo, for cash at fair market value, exercisable up to 90 days after termination or expiration. If no agreement on fair market value, an appraiser appointed by us will decide. |
| p. | Death or disability of franchisee | Section 11E | You must assign franchise to an approved buyer within 180 days. All transfer provisions of section 8 of the franchise agreement apply. |
| q. | Non-competition covenants during the term of the franchise | Section 10D | No store or food business which includes the sale of pretzels where the sale of pretzels is more than 10% of the overall revenue of the business, nor an organization franchising a similar business (subject to state law). |
| r. | Non-competition covenants after the franchise is terminated or expires | Section 10D | No store or food business which includes the sale of pretzels where the sale of pretzels is more than 10% of the overall revenue of the business for 1 year within 5 miles of your former store location, or within 5 miles of any other BEN’S SOFT PRETZELS store. No organization franchising a similar business for 1 year. No solicitation or acceptance of business from former customers for 1 year (subject to state law). |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER, AND DISPUTE RESOLUTION (FDD pages 34–37)
What This Means (2025 FDD)
According to Bens Soft Pretzels's 2025 Franchise Disclosure Document, after the franchise is terminated or expires, a franchisee is subject to certain non-competition covenants for a period of one year. Specifically, the franchisee cannot operate or have any interest in a store or food business that includes the sale of pretzels, where pretzel sales constitute more than 10% of the business's overall revenue. This restriction applies within 5 miles of the franchisee's former Bens Soft Pretzels store location, as well as within 5 miles of any other Bens Soft Pretzels store.
Additionally, the franchisee is prohibited from being involved with any organization that franchises a similar business for one year. The franchisee is also barred from soliciting or accepting business from former customers for one year, although this is subject to state law.
These non-competition terms are designed to protect Bens Soft Pretzels's market and brand integrity by preventing former franchisees from leveraging the knowledge and customer relationships gained during their franchise term to compete against the system shortly after leaving. Franchisees should be aware of these restrictions and factor them into their business plans should they decide to sell or not renew their franchise agreement.