Are there any prohibited actions outlined in the Black Bear Diner Addendum to the Franchise Agreement?
Black_Bear_Diner Franchise · 2025 FDDAnswer from 2025 FDD Document
(i) comply with all other applicable provisions of this Agreement including the noncompete provisions.
17. FRANCHISEE'S COVENANTS NOT TO COMPETE
17.1 During Term
Franchisee specifically acknowledges that pursuant to this Agreement, Franchisee will receive valuable training and Confidential Information of Franchisor and the System. Accordingly, Franchisee and the Personal Guarantors will not, during the term of this Agreement, on their own account or as an employee, agent, consultant, affiliate, licensee, partner, officer, director, or shareholder of any other person, firm, entity, partnership or corporation, own, operate, lease, franchise, conduct, engage in, be connected with, have any interest in, or assist any person or entity engaged in any Competitive Business, except with the prior written consent of the Franchisor.
17.2 After Termination
Franchisee and the Personal Guarantors covenant that, except as otherwise approved in writing by Franchisor, neither Franchisee nor the Personal Guarantors will not, for a period of two (2) years after the expiration or termination of this Agreement, regardless of the cause of for termination, either directly or indirectly, for themselves or through, on behalf of or in conjunction with, any person, persons, partnership, corporation, limited liability company or other business entity own an interest in, manage, operate, act as a consultant with respect to the management or operation of any Competitive Business within a radius of twenty-five (25) miles of the Approved Location or within twenty-five (25) miles of any other Black Bear Diner restaurant. The Franchisee and the Personal Guarantors expressly agree that the time and geographical limitations set forth in this provision are reasonable and necessary to protect the Franchisor and its franchisees if this Agreement expires or is terminated by either party for any reason, and that this covenant not to compete is necessary to permit the Franchisor the opportunity to resell or develop a new Black Bear Diner restaurant at or in the area near the Approved Location.
17.3 Modification of Covenants
Source: Item 23 — RECEIPT (FDD pages 56–243)
What This Means (2025 FDD)
According to the 2025 Black Bear Diner Franchise Disclosure Document, several actions are prohibited for franchisees during the term of the agreement and after termination. During the agreement, franchisees and their personal guarantors are prohibited from engaging in any Competitive Business without prior written consent from Black Bear Diner. This includes owning, operating, or having any interest in a business that competes with Black Bear Diner.
After the agreement terminates, the franchisee and personal guarantors are restricted from owning, managing, or consulting with a Competitive Business within a 25-mile radius of the Approved Location or any other Black Bear Diner restaurant for two years. This restriction applies regardless of the reason for termination. These covenants are in place to protect Black Bear Diner's confidential information, training, and market opportunities.
Black Bear Diner also retains specific rights, including the right to operate or license others to operate Black Bear Diner restaurants outside the franchisee's Protected Area. They can also operate other businesses, including similar restaurant concepts, under different trademarks, even within the Protected Area. Additionally, Black Bear Diner can sell or distribute products, including Gift Shop Products, through various channels like grocery stores, internet sales, and mail order, regardless of the franchisee's Protected Area. These reservations of rights allow Black Bear Diner to maintain control over its brand and distribution channels, even within areas where a franchise exists.