What is the geographic scope of the non-compete agreement for a Caring Transitions franchisee?
Caring_Transitions Franchise · 2025 FDDAnswer from 2025 FDD Document
- (a) Except as otherwise approved in writing by Franchisor, Franchisee shall not, for a continuous and uninterrupted period commencing upon the expiration, termination, or transfer of this Agreement (regardless of the cause for termination) and continuing for two (2) years thereafter, directly or indirectly, for itself or through, on behalf of, or in conjunction with any person (including a spouse, child, parent, or sibling of Franchisee or of a principal of Franchisee), partnership, limited liability company, corporation, or other entity:
- (1) own, maintain, operate, engage in, or have any interest in any business offering moving management, estate liquidation or household liquidation services, or any other services that had been offered by the franchised business, that is or is intended to be located or which operates in or within 15 miles of the geographical boundaries of Franchisee's Territory or within 15 miles of the geographical boundaries any Caring Transitions franchisee's Territory; or
- (2) promote, sell, procure, provide or solicit referrals for, or offer to sell, procure, provide or solicit referrals for, moving management, estate liquidation or household liquidation services, any Permitted Products and Services, or any other services that are offered in the franchised business, from any Shared Referral Sources (as defined in Section 8.7 above) or in or within 15 miles of the geographical boundaries of
Franchisee's Territory or in or within 15 miles of any other Caring Transitions franchisee's Territory.
- (b) Subparagraphs (a)(1) and (a)(2) above are severable and contain different but overlapping restrictions that shall be enforced simultaneously whenever permitted by applicable law.
If any of those subparagraphs is held to be invalid or unenforceable in any respect, then such provision is to be modified to the extent necessary to permit its enforcement, and the remaining provisions will be unaffected thereby.
Franchisee specifically acknowledges and agrees that the geographic and temporal restrictions on Franchisee's ability to compete with Franchisor and Franchisor's franchisees are reasonable and necessary to protect Franchisor's business interests in the relevant markets.
Source: Item 15 — OBLIGATION TO PARTICIPATE IN THE ACTUAL OPERATION OF THE FRANCHISE BUSINESS (FDD page 33)
What This Means (2025 FDD)
According to Caring Transitions' 2025 Franchise Disclosure Document, the non-compete agreement restricts a franchisee from engaging in competitive business activities within a specific geographic area after the termination, expiration, or transfer of the Franchise Agreement. This restriction lasts for two years.
The geographic scope of the non-compete includes the franchisee's territory and extends to a 15-mile radius beyond the boundaries of both the franchisee's territory and any other Caring Transitions franchisee's territory. This means a former franchisee cannot own, operate, or have any interest in a business offering similar services, such as moving management, estate liquidation, or household liquidation services, within these areas.
Furthermore, the non-compete also prohibits a former franchisee from soliciting referrals for these services from shared referral sources or within the same 15-mile radius. The FDD specifies that these restrictions are deemed reasonable and necessary to protect Caring Transitions' business interests and those of its franchisees in the relevant markets. The agreement also states that the restrictions are severable and will be enforced to the extent permitted by law.