During the term of the Coffee News franchise, can a franchisee be involved in a competing business, and if so, where?
Coffee_News Franchise · 2025 FDDAnswer from 2025 FDD Document
| PROVISION | SECTION IN FRANCHISE AGREEMENT | SUMMARY |
|---|---|---|
| q. Non-competition covenants during the term of the franchise. | Section 8.5, Exhibit A | No involvement in competing business in your state. |
Source: Item 17 — Renewal, Termination, Transfer, and Dispute Resolution (FDD pages 25–27)
What This Means (2025 FDD)
According to Coffee News's 2025 Franchise Disclosure Document, franchisees are restricted from involvement in any competing business within their state during the term of the franchise agreement. This is a standard non-compete clause designed to protect Coffee News's market share and proprietary business methods. The restriction is detailed in Section 8.5 of Exhibit A of the franchise agreement.
This non-compete provision means that a Coffee News franchisee cannot own, operate, or have any financial interest in a business that directly competes with Coffee News within the state where their franchise is located. This restriction is in place for the entire duration of the franchise term, which, as stated in the table, is a 4-year term, with the right to renew for another 4 years if provisions are met.
It is important for prospective franchisees to carefully consider the scope and limitations of this non-compete clause. While it prevents direct competition within the state, it may not restrict involvement in businesses outside of the state or in industries that are not considered directly competitive. Franchisees should seek legal counsel to fully understand the implications of this clause and how it might affect their other business interests or future opportunities. The FDD also indicates that the agreement may not be changed except by the mutual consent of both parties.