What post-term covenants must a Best Brains franchisee adhere to after termination or expiration?
Best_Brains Franchise · 2025 FDDAnswer from 2025 FDD Document
Agreement, we have the right to terminate this Agreement as if the default did in fact occur under this Agreement. For purposes of this Section, an agreement between the us or an affiliate of ours and you or your owners shall be deemed an agreement between us and you.
- D. Appointment of Manager. Notwithstanding the provisions of Sections 7.B. and 7.C. above, if you do not comply with any provision of this Agreement, we may assign a manager to the Franchised Business on a daily basis, whose function will be to ensure compliance with the provisions of this Agreement. You shall be responsible for paying us for the services of such manager at such reasonable
rate as we may establish. You agree to defend, indemnify and hold harmless the Company and its agents and employees who may act hereunder.
- E. Post Termination Obligations. If this agreement expires, is not renewed, or is terminated for any reason by any party, including a sale or transfer of the Franchised Business, you must immediately:
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- Stop identifying yourself as a franchise of ours and discontinue use of the Marks, the System, trade names, trademarks, and any other marks which are likely to be confused with our Marks;
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- Deliver to us any paper and electronic copies of the Operations Manual and the Software Program to the Company and any signs utilizing the Marks;
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- Pay all amounts owing to us or our affiliates,
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- Cancel your assumed name registration, and not represent that you formerly did business under the Marks.
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- Transfer some, or all, of the students to another BEST BRAINS learning center, refund some or all of the tuition paid by the students for subjects which have not yet been completed, and take such other actions as we may direct to ensure the orderly transition of such students.
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- Deliver to us the names, addresses and telephone numbers of your customers during the preceding three years.
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- Promptly notify the telephone company and all listing agencies of the termination or expiration of your right to use any telephone number and any regular, classified or other listings associated with the Marks and to authorize transfer of same to or at the direction of the Company. You agree that we have the sole rights to and interest in all e-mail and internet addresses, websites, domain names, social media sites and search engine identifiers, and all telephone and facsimile numbers and directory listings associated with the Marks, and you authorize us, and appoint us as your attorney-in-fact, to direct such telephone companies, internet service providers, domain name registrars, social media hosts and all listing agencies to transfer same to us or our designee.
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- If we so request, assign to us or our designee your interest in any lease then in effect for the Franchised Business premises. We have 30 days after termination or expiration of this Agreement to exercise this option.
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- Adhere to the provisions of the post-term covenants not to compete and not to solicit;
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- Abide by any other covenant in this Agreement that requires performance by you after you are no longer a franchisee; and
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- Within 30 days of termination or expiration, furnish to us satisfactory evidence of your compliance with the foregoing obligations.
- **F.
Source: Item 23 — RECEIPTS (FDD pages 42–190)
What This Means (2025 FDD)
According to Best Brains' 2025 Franchise Disclosure Document, several post-term covenants apply upon termination or expiration of the franchise agreement. These covenants dictate the franchisee's actions and restrictions following the end of the agreement. Specifically, the franchisee must pay all amounts owed to Best Brains or its affiliates, cancel their assumed name registration, and refrain from representing themselves as a former Best Brains franchisee. They are also obligated to transfer students to another Best Brains center, potentially refunding tuition for incomplete subjects, and provide customer information from the preceding three years. Additionally, the franchisee must notify the phone company and listing agencies about the termination of their right to use any phone numbers or listings associated with Best Brains.
Furthermore, the franchisee must adhere to post-term covenants not to compete or solicit customers. They must also abide by any other covenant in the agreement that requires performance after they are no longer a franchisee. Within 30 days of termination or expiration, the franchisee must furnish satisfactory evidence of compliance with these obligations to Best Brains.
Specifically, for a period of two years after termination or expiration, a franchisee cannot offer services similar to those offered by a Best Brains learning center within 25 miles of their former location or any other Best Brains location. They are also prohibited from soliciting business from any customer of the franchised business within the same geographic area for two years. These restrictions are designed to protect Best Brains' market and customer base after a franchise agreement ends.
Best Brains also has the option to purchase the franchisee's assets. Upon termination or expiration of the agreement, Best Brains has a 90-day option to purchase some or all of the franchisee's equipment, supplies, inventory, advertising materials, and any items with Best Brains' marks for cash at fair market value. This provision allows Best Brains to maintain control over branded materials and potentially re-establish a Best Brains center in the same location with a new franchisee or corporate-owned center.