Is a Caring Transitions franchisee allowed to 'maintain' a Competitive Business within the restricted area during the Restrictive Period?
Caring_Transitions Franchise · 2025 FDDAnswer from 2025 FDD Document
and ending on the second anniversary thereof (the "Restrictive Period"), directly or indirectly, for him/herself or through, on behalf of, or in conjunction with a Covered Person:
- (1) except as may be authorized under another franchise agreement in effect between Franchisee (or Covenantor) and Franchisor (including a successor agreement upon the renewal of the Franchise granted under the Franchise Agreement), own, maintain, operate, engage in, or have any interest in a Competitive Business that is or is intended to be located, or that operates, in or within 15 miles of the geographical boundaries of Franchisee's Territory; or
- (2) except as may be authorized under another franchise agreement in effect between Franchisee (or Covenantor) and Franchisor (including a successor agreement upon the
renewal of the Franchise granted under the Franchise Agreement), own, maintain, operate, engage in, or have any interest in a Competitive Business that is or is intended to be located, or that operates, in or within 15 miles of the geographical boundaries of any other Caring Transitions Franchisee's protected territory; or
Source: Item 23 — RECEIPT (FDD pages 49–202)
What This Means (2025 FDD)
According to Caring Transitions' 2025 Franchise Disclosure Document, a franchisee is generally prohibited from maintaining a Competitive Business within a specified restricted area during the Restrictive Period. The Restrictive Period begins upon the expiration or termination of the Franchise Agreement and extends for two years.
Specifically, the franchisee cannot own, maintain, operate, engage in, or have any interest in a Competitive Business that is or is intended to be located within 15 miles of the geographical boundaries of the franchisee's territory. This restriction also applies to any other Caring Transitions franchisee's protected territory. However, there is an exception: a franchisee may maintain a Competitive Business if authorized under another franchise agreement in effect between the franchisee and Caring Transitions, including a successor agreement upon renewal of the franchise.
This non-compete clause is typical in franchising to protect the brand and other franchisees. A prospective Caring Transitions franchisee should carefully consider the implications of this restriction, especially if they have prior experience or interests in similar businesses. They should also seek clarification from Caring Transitions regarding the specific circumstances under which maintaining a Competitive Business might be authorized under another franchise agreement.