factual

What post-term obligation regarding competition does a former Bens Soft Pretzels franchisee have?

Bens_Soft_Pretzels Franchise · 2025 FDD

Answer from 2025 FDD Document

and to charge the costs to you, together with a reasonable fee for the expenses we incur in doing so. You must pay these amounts to us immediately upon written notice.

  • D. Noncompete Covenants. You agree that you will receive valuable training, Confidential Information and goodwill that you otherwise would not receive or have access to but for the rights licensed to you under this Agreement. You therefore agree to the following noncompetition covenants:
      1. Unless otherwise specified, the term "you" as used in this subparagraph 10.D includes, collectively and individually, all Owners, guarantors, officers, directors, members, managers, partners, as the case may be, and holders of any ownership interest in you and any immediate family members of same including spouses and children. We may require you to obtain from your manager and other individuals identified in the preceding sentence a signed non-compete agreement in a form satisfactory to us that contains the noncompete provisions of this subparagraph 10.D.
      1. You covenant that during the term of this Agreement or during any Interim Period you will not, except as we otherwise consent to in writing, and which consent shall be unreasonably withheld, either directly or indirectly, for yourself, or through, on behalf of, or in conjunction with any person or entity, own, manage, operate, maintain, engage in, consult with or have any interest in any other store or food business other than the one authorized by this Agreement or any other agreement between us and you.
      1. You covenant that you will not, for a period of one year after the expiration or termination of this Agreement, or after the expiration of any Interim Period, regardless of the cause of termination, or within one year of the sale of the Store or any interest in you, either directly or indirectly, for yourself, or through, on behalf of, or in conjunction with any person or entity, own, manage, operate, maintain, engage in, consult with or have any interest in a Competing Business:
      • a. At the premises of the former Store;
      • b. Within 5 miles of the Store; or
      • c. Within 5 miles of any other business or store using the BEN'S SOFT PRETZELS System, whether franchised or owned by us or our affiliates.

For purposes of this Section 10.D, a Competing Business includes any 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.

  1. You agree that the length of time in subpart (3) will be tolled for any period during which you are in breach of the covenants or any other period during which we seek to enforce this Agreement. The parties agree that each of the foregoing covenants will be construed as independent of any other covenant or provision of this Agreement.

Source: Item 22 — CONTRACTS (FDD pages 46–47)

What This Means (2025 FDD)

According to Bens Soft Pretzels' 2025 Franchise Disclosure Document, a franchisee is subject to certain non-compete covenants both during the term of the agreement and after its expiration or termination. These covenants extend not only to the franchisee but also to owners, guarantors, officers, directors, members, managers, partners, and holders of any ownership interest, as well as their immediate family members. Bens Soft Pretzels may also require managers and other individuals to sign a non-compete agreement.

During the term of the agreement, a franchisee cannot engage in any other store or food business without written consent from Bens Soft Pretzels. Following the termination or expiration of the agreement, or within one year of the sale of the store or any interest in it, the franchisee is restricted from owning, managing, operating, maintaining, engaging in, consulting with, or having any interest in a Competing Business for a period of one year.

A Competing Business is defined as any 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 at the former store's premises, within 5 miles of the former store, and within 5 miles of any other business or store using the Bens Soft Pretzels system, whether franchised or owned by Bens Soft Pretzels or its affiliates. The FDD also states that an injunction is an appropriate remedy to protect the interests of the Bens Soft Pretzels system if a franchisee violates these non-compete covenants.

Disclaimer: This information is extracted from the 2025 Franchise Disclosure Document and is provided for research purposes only. It does not constitute legal or financial advice. Consult with a franchise attorney before making any investment decisions.