If a Buildingstars franchisee or their employee/affiliate performs services for a customer outside the agreement, what is the timeframe after termination, expiration, or transfer of the agreement during which the Customer Development Fee applies?

According to Buildingstars' 2025 Franchise Disclosure Document, if a Buildingstars franchisee, or any employee or affiliate of the franchisee, performs services for a customer that are similar to those under the Franchise Agreement, but are performed outside of the agreement, a Customer Development Fee will be applied. This applies if the services are performed during the term of the agreement and for one year after the termination, expiration, or transfer of the agreement.

The Customer Development Fee is equal to 3 times the monthly amount agreed to be paid to the franchisee, its employee, or affiliate for such services. This fee is designed to protect Buildingstars' interests by discouraging franchisees from independently servicing customers obtained through the franchise system, thereby ensuring that Buildingstars receives appropriate compensation for the business it has developed.

This provision means that even after a Buildingstars franchise agreement ends, the franchisee must be careful not to provide services independently to Buildingstars customers for a year. If they do, they will be required to pay a significant fee to Buildingstars. This could impact the franchisee's ability to continue in the same line of work immediately after leaving the Buildingstars system, and they should factor this into their business plans.