After the Buildingstars franchise agreement ends, for how long is the franchisee restricted from providing services to Buildingstars customers?
Buildingstars Franchise · 2025 FDDAnswer from 2025 FDD Document
[Item 22: CONTRACTS]
B. Non-Solicitation.
FRANCHISEE agrees that during the term of this Agreement and for one (1) year after the Transfer, expiration or termination for any reason of this Agreement or the entry of a final order of a court of competent jurisdiction enforcing this covenant, whichever is later, FRANCHISEE and any of its relatives, or associates, shall not, directly or indirectly, for FRANCHISEE or for any other person or entity (except BUILDINGSTARS):
- a.
Provide or attempt to provide (or others of the opportunity to provide), directly or indirectly, any Services to any Customer for which FRANCHISEE has rendered services under this Agreement or to which FRANCHISEE has been introduced by or about which FRANCHISEE has received information by being a Buildingstars franchisee.
- b.
In the event that there is a breach of this provision, Franchisee shall pay BUILDINGSTARS a fee equal to 3 times the monthly amount agreed to be paid by the Customer for the Services.
Source: Item 22 — CONTRACTS (FDD page 43)
What This Means (2025 FDD)
According to Buildingstars' 2025 Franchise Disclosure Document, a franchisee is restricted from providing services to Buildingstars customers for one year after the franchise agreement's transfer, expiration, or termination. This restriction also applies for one year after a court order enforcing this covenant. The restriction applies to the franchisee, their relatives, and associates.
Specifically, the franchisee cannot directly or indirectly provide or attempt to provide any services to any customer for whom the franchisee rendered services under the Buildingstars agreement. This also includes customers to whom the franchisee was introduced or received information about due to their affiliation with Buildingstars. This prevents a former franchisee from leveraging their knowledge and relationships gained during their franchise term to unfairly compete with Buildingstars.
If a franchisee breaches this non-solicitation provision, they must pay Buildingstars a fee equal to three times the monthly amount the customer agreed to pay for services. This substantial penalty is designed to deter franchisees from violating the non-solicitation agreement and ensures Buildingstars is compensated for any lost revenue resulting from the breach. The non-solicitation agreement aims to protect Buildingstars' customer base and maintain the integrity of its franchise system.