What section of the Buff City Soap FDD discusses restrictive covenants?
Buff_City_Soap Franchise · 2025 FDDAnswer from 2025 FDD Document
The above covenants apply exclusively in the United States of America during the time that you serve as Operator for the Makery and within three miles of any then-existing Buff City Soap Makery during the 2-year period following the date you cease to be Operator of the Makery.
If all or any portion of this Agreement is held unreasonable or unenforceable by a tribunal, court or agency having valid jurisdiction in an unappealed final decision to which Employer is a party, you agree to be bound by any lesser covenant subsumed within the terms of such covenant that imposes the maximum duty permitted by applicable law. If any portion of the restrictions contained in this Agreement are held to be unreasonable, arbitrary or against public policy by any tribunal, court or agency having valid jurisdiction, then the restrictions will be considered divisible, both as to time and to the geographical area, with each month or the specified period being deemed a separate period of time and each radius mile of the restricted territory being deemed a separate geographical area, so that the lesser period of time or geographical area will remain effective and may be enforced against you so long as the same is not unreasonable, arbitrary, or against public policy. If you violate any of the covenants contained herein, and if any court, tribunal or agency action is instituted by Employer to prevent or enjoin such violation, then the period of time during which the covenants of this Agreement apply will be lengthened by a period of time equal to the period between the date of the breach of the terms or covenants contained in this Agreement and the date on which the decree of the disposition of the tribunal, court or agency having valid jurisdiction of the issues upon the merits will become final and not subject to further appeal.
You acknowledge that the geographical and time limitations contained in this Agreement are reasonable and properly required for the adequate protection of the Confidential Information, including Franchisor's trade secrets. You acknowledge that Employer will provide to you training and Confidential Information in reliance upon the covenants contained in this Agreement.
Without limiting any provision of this Agreement, you and Employer recognize and agree that Franchisor is a third party beneficiary of this Agreement, and at all times during and after your employment with Employer, Franchisor will have the independent right to enforce the terms of this Agreement.
Source: Item 23 — Receipts (FDD pages 69–186)
What This Means (2025 FDD)
According to the 2025 Buff City Soap FDD, Item 23 discusses restrictive covenants. Specifically, it outlines non-compete agreements that apply both during the term of the franchise agreement and for a period after its expiration or termination. These covenants dictate that franchisees and their principals cannot engage in any competitive business, either directly or indirectly, without prior written consent from Buff City Soap.
The restrictions apply exclusively in the United States while the franchisee serves as the operator. Following the cessation of the operator role, the restrictions extend to a three-mile radius of any existing Buff City Soap location for a two-year period. This includes not diverting business, performing acts prejudicial to the goodwill of the brand, or having any interest in a competitive business. The FDD also addresses the enforceability of these covenants, stating that if any part is deemed unreasonable, the restrictions will be considered divisible and the maximum duty permitted by law will apply.
Buff City Soap emphasizes the importance of these covenants for protecting confidential information and trade secrets, acknowledging that the franchisor provides training and confidential information to the franchisee in reliance upon these agreements. Furthermore, the franchisor is identified as a third-party beneficiary of the agreement, granting them the independent right to enforce its terms. These measures are designed to protect Buff City Soap's market position and proprietary information, ensuring that franchisees do not leverage their knowledge gained during the franchise term to compete against the brand after the agreement ends.