Are Owners of a Card My Yard franchise required to sign a non-competition agreement?
Card_My_Yard Franchise · 2025 FDDAnswer from 2025 FDD Document
thereof, or (ii) the termination, expiration or transfer of Franchisee's interest in the Franchise Agreement, you will not, without our prior written consent or as permitted under other valid Franchise Agreements for Card My Yard businesses between Franchisee and us:
- a. Directly or indirectly divert, or attempt to divert any business opportunity or customer of Card My Yard businesses to any competitor; and
- b. Directly or indirectly, for yourself or through, on behalf of, or in conjunction with any other person, persons, partnership, corporation, limited liability company, or other association or entity, own, maintain, operate, engage in or have any financial or beneficial interest in, advise, assist or make loans to, any business which is the same as or similar to a Card My Yard business (including any business that offers yard greeting services or other celebratory display items or services of any kind, including but not limited to, balloon displays, lighted displays, etc.) and which is, or is intended to be, located within the United States, its territories or commonwealths, or any other country, province, state or geographic area in which we or our Affiliates have used, sought registration of or registered the Marks or similar marks or operate or license others to operate a business under the Marks or similar marks; provided that during the two year-period following termination, expiration or transfer of the Franchise Agreement, the non-compete restrictions shall be limited to operations: (i) at the Franchise Location, (ii) within the Protected Area, (iii) within a twenty-five (25)-mile radius of the Franchise Location, or (iv) within a twenty-five (25)-mile radius of any Card My Yard business then in existence or under construction.
Franchisee's Undertaking
Franchisee agrees to make all commercially reasonable efforts to ensure that you act as required by this Agreement.
Miscellaneous
1. You agree that:
- a. Each of the covenants herein contain reasonable limitations as to time, geographical area, and scope of activity to be restrained and do not impose a greater restraint than is necessary to protect the goodwill of the System or our other business interests.
- b. Each of the foregoing covenants shall be construed as independent of any other covenant or provision of this Agreement.
Source: Item 23 — RECEIPTS (FDD pages 84–259)
What This Means (2025 FDD)
According to Card My Yard's 2025 Franchise Disclosure Document, franchisees are restricted from engaging in competitive activities during the term of the franchise agreement and for a period after the agreement's termination, expiration, or transfer. Specifically, franchisees cannot directly or indirectly participate in any business that is the same as or similar to a Card My Yard business. This includes businesses offering yard greeting services, celebratory displays, balloon displays, or lighted displays.
The non-compete restrictions apply within the United States, its territories, commonwealths, or any other geographic area where Card My Yard or its affiliates have used, sought registration of, or registered their marks. However, after the termination, expiration, or transfer of the Franchise Agreement, the non-compete restrictions are limited to a two-year period and are further restricted to operations at the Franchise Location, within the Protected Area, within a twenty-five (25)-mile radius of the Franchise Location, or within a twenty-five (25)-mile radius of any Card My Yard business then in existence or under construction.
The FDD also states that the existence of any claims the franchisee may have against Card My Yard does not constitute a defense against the enforcement of the non-competition covenants. Furthermore, any period of non-compliance with the non-competition agreement will extend the 2-year non-competition period by an equivalent duration. Franchisees and their owners must agree that the non-competition covenants contain reasonable limitations regarding time, geographical area, and scope of activity, ensuring they do not impose a greater restraint than necessary to protect the goodwill of the Card My Yard system or its business interests.