What post-term non-competition restrictions apply to a former C3 Wellness Spa franchisee?
C3_Wellness_Spa Franchise · 2024 FDDAnswer from 2024 FDD Document
--------------------------------------------------------------------------------------------| | r. | Non-competition covenants after the franchise is terminated or expires | 6, 17.E. | No involvement, ownership or interest whatsoever for 24 months in any competing business in: your Designated territory; a 25 mile radius of your Designated territory; a 25 mile radius of the Designated Territory of any other Spa Location Franchise; and you must comply with confidentiality, non-disclosure and non-solicitation covenants. | | s. | Modification of the agreement | 18.L. | Requires writing signed by you and us, except for unilateral changes that we may make to the Manuals or our unilateral reduction of the scope of a restrictive covenant that we may make in our discretion. | | t. | Integration/merger clauses | 18.M.
Source: Item 17 — RENEWAL, TERMINATION, TRANSFER AND DISPUTE RESOLUTION (FDD pages 43–50)
What This Means (2024 FDD)
According to C3 Wellness Spa's 2024 Franchise Disclosure Document, a former franchisee faces specific non-competition restrictions after the termination or expiration of their franchise agreement. These restrictions are in place for 24 months.
During this 24-month period, the franchisee cannot be involved in any competing business within their designated territory. This restriction also extends to a 25-mile radius of both their designated territory and a 25-mile radius of any other C3 Wellness Spa location's designated territory. This means a franchisee is restricted from operating or being involved with a competing business not only in their immediate area but also in a broader region that includes other C3 Wellness Spa locations.
In addition to these geographical and activity-based restrictions, the franchisee must continue to comply with confidentiality, non-disclosure, and non-solicitation covenants. These covenants prevent the franchisee from sharing proprietary information, trade secrets, or soliciting employees or customers of C3 Wellness Spa. These measures are designed to protect C3 Wellness Spa's business interests and maintain its competitive edge in the market.
These post-term non-competition covenants do not apply to Multi-Unit Development Agreements, but each Spa Location Franchise developed under a Multi-Unit Development Agreement will be subject to the non-competition covenants outlined in their respective Franchise Agreement.