Can a Restricted Party lend money to a Competitor during the term of the Better Blend agreement?
Better_Blend Franchise · 2024 FDDAnswer from 2024 FDD Document
- (a) Restriction In Term. During the term of this Agreement, neither Franchisee, any Owner, nor any spouse of an Owner (the "Restricted Parties") shall directly or indirectly have any ownership interest in, lend money or provide financial assistance to, provide any services to, or be employed by, any Competitor.
Source: Item 22 — CONTRACTS (FDD page 43)
What This Means (2024 FDD)
According to Better Blend's 2024 Franchise Disclosure Document, during the term of the Franchise Agreement, a Restricted Party is prohibited from lending money or providing financial assistance to a Competitor. Restricted Parties include the franchisee, any owner, or any spouse of an owner. This restriction is in place to prevent conflicts of interest and protect Better Blend's market position.
This means that franchisees and their immediate family members with ownership stakes cannot support competing businesses financially while operating a Better Blend franchise. This restriction aims to ensure that franchisees remain fully committed to the success of their Better Blend business and do not divert resources to competitors.
After the agreement expires or is terminated, this restriction continues for two years. During this post-term period, Restricted Parties are prohibited from lending money or providing financial assistance to a Competitor within five miles of the franchisee's territory or within five miles of any other Better Blend business operating on the date of expiration, termination, or transfer.