What section of the Bhc Franchise Agreement addresses post-termination competition?
Bhc Franchise · 2025 FDDAnswer from 2025 FDD Document
oration or other entity, (i) divert or attempt to divert any business or customer of the Franchised Business to any competitor, by direct or indirect inducement or otherwise, or (ii) do or perform, directly or indirectly, any other act injurious or prejudicial to the goodwill associated with the Marks or the System.
11.2 Post Termination Non-Competition Covenants.
- (a) For a period of two years after the date ("Termination Date") this Agreement is terminated, is canceled, or expires without renewal pursuant to section 5.2 of this Agreement, Master Franchisee agrees that neither Master Franchisee nor any Principal Equity Operator will (either directly or indirectly, for itself or themselves, or through, on behalf of, or in conjunction with, any person, persons, partnership, corporation or other entity) operate, manage, own, assist or hold an interest in (direct or indirect as an employee, officer, director, shareowner, partner or otherwise), or engage in, any competing business selling goods or offering services equivalent to BHC Products or the Franchised Business, within a radius of 25 miles of Master Franchisee's Territory or any other authorized retail location selling BHC Products, without Franchisor's express prior written consent, which consent may be withheld in Franchisor's sole and absolute discretion. Following termination or expiration of this Agreement, Master Franchisee must always refrain from any use, direct or indirect, of any Proprietary Information or Trade Secrets.
Source: Item 23 — Receipts (FDD pages 52–230)
What This Means (2025 FDD)
According to Bhc's 2025 Franchise Disclosure Document, section 11.2 of the Franchise Agreement details the post-termination non-competition covenants. This section outlines the restrictions placed on the franchisee after the termination, cancellation, or expiration of the franchise agreement.
Specifically, for a period of two years following the termination date, the franchisee and any Principal Equity Operator are prohibited from engaging in any competing business that sells goods or offers services equivalent to Bhc products or the franchised business. This restriction applies within a 25-mile radius of the franchisee's territory or any other authorized retail location selling Bhc products. The franchisor's prior written consent is required to engage in such activities, and the franchisor may withhold this consent at their discretion.
Additionally, the franchisee must refrain from using any proprietary information or trade secrets after the termination or expiration of the agreement. The FDD also states that if any applicable law or regulation limits the franchisor's rights under section 11.2(a), the section will be amended or deleted to conform to those legal requirements. However, the provisions of the agreement will only be amended to the extent necessary to comply with the law or regulation.