Are covenants related to non-solicitation and non-competition in the Buildingstars agreement interpreted with reasonableness and equity?
Buildingstars Franchise · 2025 FDDAnswer from 2025 FDD Document
All covenants contained in this Agreement, including but not limited to those relating to non-solicitation and non-competition shall be interpreted and applied consistent with the requirements of reasonableness and equity.
BUILDINGSTARS intends to restrict the activities of the FRANCHISEE under Sections IX and X of this Agreement only to the extent necessary for the protection of BUILDINGSTARS' legitimate business interests.
For the sake of clarity, nothing herein is to restrict FRANCHISEE from providing janitorial/cleaning services to any entity or person that is not a Customer; provided however, that the foregoing shall not alter FRANCHISEE's obligations, including but not limited to Section IX above, under this Agreement.
Source: Item 22 — CONTRACTS (FDD page 43)
What This Means (2025 FDD)
According to Buildingstars's 2025 Franchise Disclosure Document, the franchise agreement includes provisions to ensure that covenants related to non-solicitation and non-competition are interpreted and applied with reasonableness and equity. Specifically, the agreement states that all covenants, including those related to non-solicitation and non-competition, will be interpreted and applied in a manner consistent with reasonableness and equity. This suggests that Buildingstars aims to enforce these restrictions fairly, considering the franchisee's circumstances.
Additionally, the Buildingstars agreement contains a severability clause, which means that if any provision is deemed invalid, it will not affect the remaining portions of the agreement. Furthermore, if any restriction is considered too broad, a court is authorized to modify or limit the restriction to the extent necessary for enforcement. This demonstrates a willingness to ensure the restrictions are not overly burdensome and are tailored to protect Buildingstars' legitimate business interests without unduly hindering the franchisee.
Buildingstars also states its intention to restrict franchisee activities only to the extent necessary to protect its legitimate business interests. The agreement clarifies that franchisees are not restricted from providing janitorial/cleaning services to entities or persons who are not current Buildingstars customers. This provides some flexibility for franchisees to earn a livelihood outside of the Buildingstars customer base, further supporting the idea of reasonableness in the restrictions imposed. However, franchisees should be aware that these allowances do not alter their other obligations under the agreement.