Does the Bumper Man franchise agreement allow the franchisee to lease property to a Competitive Business?
Bumper_Man Franchise · 2025 FDDAnswer from 2025 FDD Document
For so long as you are Franchisee's Principal under the Franchise Agreement and for a period of two years from the date you cease to be Franchisee's Principal, you will not, either directly or indirectly, individually or through, on behalf of, or in conjunction with any other person:
- (i) Own, maintain, operate, be employed by, engage in, franchise, lease property to, advise, help, make loans to, or have any interest in, either directly or indirectly, any Competitive Business;
- (ii) Divert or attempt to divert any actual or prospective business or customer of the Bumper Business to any Competitive Business, by direct or indirect inducement or otherwise; or
- (iii) Perform, directly, any or indirectly, any other act injurious to or prejudicial to the goodwill associated with the Marks and the System
The above covenants apply exclusively in the United States of America during the time that you serve as Principal for the Bumper Business and within 25 miles of any then-existing Bumper Man business during the two-year period following the date you cease to be the Principal of the Bumper Business.
Source: Item 23 — RECEIPTS (FDD pages 45–180)
What This Means (2025 FDD)
According to the 2025 Bumper Man Franchise Disclosure Document, the franchise agreement places restrictions on a franchisee's ability to lease property to a competitive business. Specifically, during the term of the agreement, a franchisee is prohibited from leasing property to any Competitive Business within the United States.
After the franchise term concludes, either through expiration, termination, or an approved transfer, the restriction modifies. It then applies to any Competitive Business located within 25 miles of the franchisee's designated area or any other Bumper Man business. This post-term restriction is subject to written approval from Bumper Man.
The agreement also includes a clause addressing the reasonableness of these restrictions, stating that if any part of the restrictions regarding time or distance is found unreasonable, the time or distance may be reduced by a court order to what is deemed reasonable. Furthermore, any period of non-compliance with these restrictions during the two-year period following the end of the agreement will not count towards fulfilling the restriction period.