What specific activities are prohibited by the non-competition covenants after the Bevaris Alliance franchise is terminated or expires?
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, after the franchise is terminated or expires, franchisees are prohibited from having a connection with a competing business for 24 months.
This non-compete clause means that for two years following the end of the franchise agreement, a former Bevaris Alliance franchisee cannot be involved with any business that competes with Bevaris Alliance. This includes owning, operating, or even working for a competing business. The restriction aims to protect Bevaris Alliance's market share and confidential business information.
Such non-compete agreements are common in franchising to prevent franchisees from using the franchisor's knowledge and brand recognition to unfairly compete after the franchise relationship ends. The specific scope and duration of these clauses can vary, but Bevaris Alliance's 24-month restriction is within a typical range. A prospective franchisee should carefully consider the implications of this restriction, especially if they plan to remain in the same industry after leaving the Bevaris Alliance system.