Are there any exceptions to the non-competition covenants during the term of the Burros Fries Franchise Agreement?

According to the 2024 Burros Fries Franchise Disclosure Document, there is an exception to the non-competition covenant during the term of the franchise agreement. The agreement states that franchisees are prohibited from involvement in any competitive business anywhere in the U.S., but this restriction does not apply to any existing businesses the franchisee may already own. This means that a franchisee can continue to operate a business that competes with Burros Fries, provided they owned it before signing the Franchise Agreement.

This exception could be beneficial for individuals who already have established businesses in the food service industry or related sectors. It allows them to diversify their investments by opening a Burros Fries franchise without having to divest their existing business interests. However, it's crucial for prospective franchisees to fully understand the scope of what constitutes a "competitive business" to ensure they remain in compliance with the franchise agreement.

It is important to note that this exception only applies during the term of the franchise. After the franchise is terminated or expires, a different non-competition covenant applies, which restricts the franchisee from having any interest in a competing business for two years within ten miles of any company-owned outlet or other franchises. Therefore, the initial exception for existing businesses does not extend beyond the duration of the franchise agreement.