Are covenants relating to non-solicitation and non-competition in the Buildingstars agreement interpreted with reasonableness?
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.
The foregoing covenants shall be construed as severable and independent and shall be interpreted and applied consistent with the requirements of reasonableness and equity.
FRANCHISEE acknowledges that the restrictions imposed in this Section are reasonable and their enforcement will not cause an undue burden upon FRANCHISEE'S ability to earn a livelihood.
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 with reasonableness and equity. This means that Buildingstars intends to restrict a franchisee's activities only to the extent necessary to protect its legitimate business interests.
The agreement states that all covenants, including those related to non-solicitation and non-competition, will be interpreted and applied consistently with the requirements of reasonableness and equity. Furthermore, if a court finds any restriction too broad, it is authorized to modify or limit the restriction to permit its enforcement. Buildingstars also has the right to reduce the scope of any covenant without the franchisee's consent, effective immediately upon written notice.
This approach provides some reassurance to a prospective Buildingstars franchisee that the non-solicitation and non-competition clauses will not be overly restrictive. The franchisee acknowledges that the restrictions imposed are reasonable and their enforcement will not cause an undue burden upon the franchisee's ability to earn a livelihood. This suggests that Buildingstars aims to strike a balance between protecting its business interests and allowing franchisees to operate and earn a living.