For Closet Storage Concepts, what is the duration of the non-compete period after the transfer of the agreement?
Closet_Storage_Concepts Franchise · 2025 FDDAnswer from 2025 FDD Document
For a period of 2 years after the expiration, nonrenewal, transfer or termination of this Agreement, regardless of the cause, neither Franchisee, nor its equity owners shall, directly or indirectly, for itself or through, on behalf of, or in conjunction with any other person, partnership or corporation own, maintain, engage in, be employed by, or have any interest in any other Competing Business within the Territory or a radius of 20 miles from the Territory or any other Closet & Storage Concepts or More Space Place company owned or franchised business in operation or for which a franchise agreement has been signed, as of the date of expiration and nonrenewal, transfer or termination of this Agreement; provided, however, Franchisee may continue to operate any other Closet & Storage Concepts or More Space Place franchises for which Franchisee and Franchisor have a current franchise agreement.
For a period of 2 years after the expiration, nonrenewal, transfer or termination of this Agreement,
regardless of the cause, neither Franchisee, nor its equity owners shall, directly or indirectly, for itself or through, on behalf of, or in conjunction with any other person, partnership or corporation solicit business from customers of Franchisee's former Franchised Business for any competitive business purpose nor solicit any employee of Franchisor or any other Closet & Storage Concepts or More Space Place System franchisee to discontinue his or her employment.
Source: Item 22 — CONTRACTS (FDD page 59)
What This Means (2025 FDD)
According to Closet Storage Concepts' 2025 Franchise Disclosure Document, if you transfer your franchise agreement, you and your equity owners are subject to a non-compete period of 2 years. This restriction applies regardless of the reason for the transfer.
During this 2-year period, you cannot directly or indirectly own, maintain, engage in, be employed by, or have any interest in any other business that competes with Closet Storage Concepts within your former territory. The non-compete also extends to a 20-mile radius from your territory, as well as any other Closet Storage Concepts or More Space Place company-owned or franchised business that was in operation or had a signed franchise agreement at the time of the transfer.
Additionally, for 2 years after the transfer, you are prohibited from soliciting business from customers of your former Closet Storage Concepts franchise for any competitive purpose. You are also barred from soliciting any employee of Closet Storage Concepts or any other Closet Storage Concepts or More Space Place franchisee to discontinue their employment. These restrictions are designed to protect Closet Storage Concepts' market position and prevent franchisees from leveraging their knowledge and relationships gained during their franchise term to unfairly compete with the system after they leave.