Does the Confidentiality and Non-Compete Agreement for Burros Fries mention any exceptions to the non-compete clause?
Burros_Fries Franchise · 2024 FDDAnswer from 2024 FDD Document
Franchisee agrees that, except as otherwise approved in writing by us, Franchisee shall not, during the term of this Agreement and for a period of two (2) years from the date of (i) a transfer permitted under this Agreement; (ii) the expiration or termination of this Agreement (regardless of the cause for termination); or (iii) a final order of a duly authorized arbitrator, panel of arbitrators, or a court of competent jurisdiction (after all appeals have been taken) with respect to any of the foregoing or with respect to the enforcement of this Section 19.C, either directly or indirectly for itself, or through, on behalf of, or in conjunction with, any person, persons, or legal entity, own, maintain, operate, engage in, be employed by, or have any interest in any business using any aspect of the System, the overall Burros & Fries business concept, with similar Products and/or Services within a ten (10) mile radius of the Accepted Location designated hereunder, or within a ten (10) mile radius of any other System franchise or company-owned business in existence or planned as of the time of termination or expiration of this Agreement as identified in the Franchise Disclosure Document in effect as of the date of expiration or termination of this Agreement.
Source: Item 22 — CONTRACTS (FDD page 53)
What This Means (2024 FDD)
According to the 2024 Burros Fries Franchise Disclosure Document, the non-compete agreement contains an exception. The agreement states that a franchisee cannot engage in a similar business within a 10-mile radius of their Burros Fries location or any other existing or planned Burros Fries franchise. However, this restriction does not apply if Burros Fries provides written approval allowing the franchisee to compete.
Specifically, the non-compete clause applies during the term of the Franchise Agreement and for two years after a permitted transfer, expiration, or termination of the agreement. This restriction is in place to protect Burros Fries's confidential information, specialized training, and overall business concept that franchisees gain access to during their time with the company.
If any part of the non-compete agreement is deemed unenforceable in a particular jurisdiction, it does not affect its enforceability in other jurisdictions. Furthermore, in such cases, Burros Fries has the option to purchase the franchisee's business upon the agreement's expiration or termination, which they can exercise with 30 days' written notice. This clause ensures that Burros Fries can maintain control over its brand and business model even if the non-compete agreement is not fully enforceable.