For how long after termination or expiration of the Bevaris Alliance franchise is the franchisee prohibited from having a connection with a competing business?
Bevaris_Alliance Franchise · 2024 FDDAnswer from 2024 FDD Document
| Provision | Section in Franchise Agreement | Summary |
|---|---|---|
| which must be approved by us. | ||
| l. Bevaris approval of transfer | Section | We have the right to approve all transfers, which shall be |
| by franchisee | 16.11 | subject to the provisions of the Franchise Agreement. |
| m. Conditions for Bevaris approval of transfer | Section 16.11 | Transferee approved by us, transfer fee paid, transferee not competitor, your account is current, you sign a release, transferee signs all documents, lender consents, and subordination agreements. |
| n. Bevaris’ right of first refusal to acquire franchisee’s business | Section 16.3 | Bevaris can match any offer for the purchase of Your franchise at Bevaris’ option. |
| o. Bevaris’ option to purchase Your business | Section 16.7 | Upon transfer, fair market value (but no value for goodwill), legal compliance, no assumption of your liabilities. |
| p. Death or disability of | Section 17 | Franchise may be assigned by estate to approve transferee |
| franchisee | in three months. | |
| q. Non-competition covenants during the term of the franchise | Section 20.1 | You are prohibited from operating or having an interest in a similar business. |
| r. Non-competition covenants | Section 20.1 | You are prohibited for 24 months from expiration or |
| after the franchise is | termination of the franchise from having a connection | |
| terminated or expires | with a competing business. |
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 17–18)
What This Means (2024 FDD)
According to Bevaris Alliance's 2024 Franchise Disclosure Document, a franchisee is prohibited from having a connection with a competing business for a period of 24 months following the expiration or termination of the franchise agreement. This non-compete clause is detailed in Section 20.1 of the franchise agreement.
This restriction means that for two years after leaving the Bevaris Alliance system, a former franchisee cannot be involved in a similar business. This includes operating, having an ownership stake, or any other form of association with a competing business. The purpose of this clause is to protect Bevaris Alliance's market share, trade secrets, and customer relationships by preventing former franchisees from using their knowledge gained within the franchise to directly compete against it.
Non-compete agreements are common in franchising to protect the franchisor's business model and brand. The specific terms, including the duration and geographic scope, can vary. Prospective franchisees should carefully review Section 20.1 of the Bevaris Alliance franchise agreement to fully understand the restrictions and ensure they are comfortable with these limitations before investing in the franchise. It is advisable to seek legal counsel to assess the enforceability and implications of the non-compete clause in their specific circumstances.