For how long after termination of the Bevaris Alliance agreement is a franchisee prohibited from having business dealings with Restricted Customers?
Bevaris_Alliance Franchise · 2024 FDDAnswer from 2024 FDD Document
keeping, supervision, custody and insurance of them.
19.6 Right of entry. If the Franchisee fails to fulfil its obligations under this clause 19 within a reasonable time, the Franchisor may, at the expense of the Franchisee, immediately and without notice, enter onto the Franchisee's premises and take such steps as it thinks fit to fulfil any outstanding obligations.
20. Restrictions
- 20.1 In order to protect the Confidential Information, trade secrets and business connections of the Franchisor and the Franchisor's other franchisees, the Franchisee and the Individual covenant with the Franchisor that they shall not:
- (a) during the Term or for 24 months after termination or expiration of this agreement, solicit or endeavor to entice away from the Franchisor or any other franchisee of the Franchisor the business or custom of a Restricted Customer with a view to providing goods or services to that Restricted Customer in competition with any Restricted Business; or
- (b) during the Term or for 24 months after termination or expiration of this agreement, in the course of any business concern which is in competition with or similar to the Branded Business or any business of the Franchisor or any Restricted Business, offer to employ or engage, or otherwise endeavor to entice away, any employee of the Franchisor or any other franchisee of the Franchisor who could materially damage the interests of the Franchisor or any other franchisee of the Franchisor, and with whom the Franchisee or the Individual dealt in the 24 months prior to termination of this agreement; or
- (c) during the Term, or for 24 months after termination or expiration of this agreement, be involved as agent, consultant, director, employee, owner, partner or shareholder with any business concern which is (or intends to be) in competition with any Restricted Business; or
- (d) during the Term, or for 24 months after termination of this agreement, be involved with the provision of goods or services to (or otherwise have any business dealings with) any Restricted Customer in the course of any business concern which is in competition with any Restricted Business; or
- (e) at any time after termination of this agreement, represent himself as connected, in any way, with the Franchisor.
- 20.2 None of the restrictions in clause 20.1 shall prevent the Franchisee or Individual from:
- (a) holding an investment by way of shares or other securities of not more than 5% of the total issued share capital of any company, whether or not it is listed or dealt in on a recognized stock exchange;
Source: Item 23 — RECEIPT (FDD pages 22–88)
What This Means (2024 FDD)
According to the 2024 Bevaris Alliance Franchise Disclosure Document, franchisees are restricted from engaging in certain business activities with Restricted Customers for a period of 24 months following the termination or expiration of the franchise agreement. Specifically, franchisees are prohibited from being involved with the provision of goods or services to, or otherwise having any business dealings with, any Restricted Customer in the course of any business concern which is in competition with any Restricted Business. A Restricted Customer is defined as any firm, company, or person who, during the 12 months prior to the date of termination of the agreement, was a customer of or in the habit of dealing with the franchisee.
This restriction is designed to protect Bevaris Alliance's confidential information, trade secrets, and business connections, as well as those of its other franchisees. The term 'Restricted Business' refers to any business of Bevaris Alliance that is similar to the franchisee's business. This non-compete clause ensures that former franchisees do not unfairly leverage their knowledge of and relationships with Bevaris Alliance customers to compete against the brand after leaving the system.
It is important to note that this restriction applies to the franchisee acting directly or indirectly, and on their own behalf or in conjunction with any firm, company, or person. However, the restrictions do not prevent the franchisee from holding an investment of not more than 5% of the total issued share capital of any company. Each restriction within this clause is intended to be separate and severable, meaning that if any restriction is deemed void, it will be adjusted to remain valid and effective to the extent possible.