During the term of the Buildingstars agreement and for one year after termination, can a franchisee's relatives or associates provide services to a Buildingstars customer?
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's 2025 Franchise Disclosure Document, during the term of the franchise agreement and for one year after its termination, a franchisee and their relatives or associates are restricted from providing services to Buildingstars customers. Specifically, they cannot directly or indirectly provide services to any customer for whom the franchisee has rendered services or about which the franchisee received information due to their affiliation with Buildingstars. This restriction applies whether the franchisee is acting on their own behalf or for another entity, excluding Buildingstars itself.
This non-solicitation clause is designed to protect Buildingstars' customer base and prevent franchisees from leveraging their knowledge and relationships gained during the franchise term to compete with Buildingstars after the agreement ends. The restriction extends not only to the franchisee but also to their relatives and associates, broadening the scope of the non-solicitation agreement.
If a franchisee breaches this provision, they are obligated to pay Buildingstars a fee. This fee is calculated as three times the monthly amount that the customer agreed to pay for the services. This penalty serves as a deterrent against violating the non-solicitation agreement and compensates Buildingstars for the potential loss of revenue resulting from the franchisee's actions.
This restriction remains in effect for one year after the agreement's termination, expiration, or transfer, or after a court order enforcing the covenant, whichever is later. This extended period ensures that Buildingstars has sufficient time to protect its customer relationships and prevent unfair competition from former franchisees and their affiliates.